The fundamental approach to assessing the benefits of gaming is to recognise that these represent the preferences that people express in their spending decisions. Where gambling is prevented, consumers' expenditures are redirected towards goods and services from which they would expect to enjoy less satisfaction. The increased consumer benefits will not always be recorded in measured estimates of gross domestic product but are, nonetheless, significant. The benefits are substantial and potentially measurable in the attraction of tourists and the reduction in siphoning of expenditures to areas which enjoy more liberal gambling regulations. These benefits represent the equivalence of an increase in competitiveness of the area where gambling is liberalised.
Gaming also represents a relatively easy source of taxation revenue.
Although such taxation represents a distortion to consumer choice, the relatively low response of demand to higher charges for gaming and the 'guilt' felt by gamblers has meant governments have had little difficulty raising revenues from the sector. This matter has assumed considerable importance in Australia due to the State Governments' reduced access to certain forms of taxation. This is far in excess of that imposed on almost all other goods and services. The 'sinful' characterisation of gambling activity facilitates government imposition of punitive taxation rates. Yet, the freedom of the individual to spend his or her money as he or she sees fit is fundamental both to economic welfare and to individual liberty.