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The State of Israel features one of the most strict gambling laws in the world, which is dictated by the strong impact of religious, cultural, and social influences. Under the Penal Law, almost every form of gambling has been prohibited, with only two controlled by the state: the National Lottery, also known as Mifal Hapayis, and sports betting under the Israeli Sports Betting Board, abbreviated as ISBB. With such a restriction, gambling remains popular in Israel, creating an underground market that has continued to set the country abuzz.
This article was written on September 24, 2024, and is based on information available on that date. Because regulations by nature are subject to change, one should consult with local experts for the most current information available pertaining to gambling laws in Israel.
Legal gambling options
Speaking of legal gambling, there are not many options that Israel offers. In this respect, the national lottery, Mifal Hapayis, was established in 1967 and is one of the few legal types of gambling. This type of lottery helps finance many public projects like education and healthcare. The second legal type of gambling is sports betting, which was legalised in 1968 under the Sports Betting Law, and it’s overseen by the ISBB. Both these forms are a lot regulated, where it has to stick to most of the laws provided.
Casinos, on the other hand, are wholly illegal within the borders of Israel. By law, the government forbids any casino activity to be held on land. Of course, there is one exception: a few Israelis have been known to gamble on cruise ships that take off from the Israeli ports, which technically has to wait until the ship sails out of territorial waters.
Underground gambling
Despite the very strict legal system, illegal underground gambling is highly developed in Israel and includes both land-based casino premises and online gambling services. Some reports note that the value of illegal gambling in Israel is more than $3.5 billion annually, which testifies to the demand for casino-type games despite the absence of legal channels.
Though this has often been raided by the government, the demand prevails, which continues to drive the black market. This is often done through illegal gambling networks that extend services similar to those provided by countries offering lenient laws on gambling, attracting Israeli players in the process.
Online gambling laws
Online gambling is another area where Israel takes a tough stance. Since 2005, with some considerations for state-regulated lotteries and sports betting websites, online casinos and poker rooms have been banned, among other types of online wagering. In its attempt to suppress illegal online gambling, the Israeli government has tried several times to restrict access to foreign sites that handle gambling. In 2017, a new law entitled “Powers to Prevent Offences Through an Internet Site” gave the right of the government to block access to gambling sites. Accordingly, several sites have been blocked, but players manage to bypass such restrictions through virtual private networks or through proxy servers.
Despite the ban on foreign sites, many players in Israel access foreign gambling websites. Such websites, some of which even target specifically Israeli audiences, offer their services in Hebrew and also accept the Israel Shekel. This has made it much easier for people in Israel to gamble online, even though it is technically not supposed to be permitted.
Efforts to restrict gambling on the internet
The Israeli attempts at blocking online gambling have not succeeded entirely. Players have methods of finding ways around government blocks, often through alternative DNS services or anonymisation of their internet traffic. This means that even with very strict laws, online gambling is still available to a lot of Israelis.
Yet serious enforcement efforts have constantly been overcome by challenges in the digital space. With each advancement in technology, so too come advancements in methods used by players to evade detection, making it hard for illegal online gambling to be fully stamped out in Israel.
Cultural and religious influence
Such factors as religion and culture are highly present in the strict Israeli gambling laws. To many citizens, but more so to religious leaders, gambling is considered a vice. The stance taken in the legal framework by the government speaks of limits to gambling through state-controlled options.
Over the years, there have been debates on legalising other forms of gambling, including opening a casino in Eilat, the country’s prime tourist destination. Most of these proposals have been successfully opposed by religious and conservative groups. Many have held up security concerns, mainly relating to organised crime issues, as sufficient reasons to avoid the development of a gambling market.
Economic and social impact
Economically, state control over lottery and sports betting generates much money. Much of that money is channelled into public services such as education and health. Liberalisers of the laws on gambling, however, counter that it is more legal forms of gambling that would help boost the economy of Israel through tourism, job creation, and through tax income.
But gambling also presents some significant social risks, particularly in the form of addiction. In Israel, for example, where public stigma against addiction to gambling has complicated efforts by both government and nongovernmental organisations to provide treatment services, despite the existence of such programs. An underground market and illegal gambling operations definitely increase these risks since they lack the kinds of protections available in regulated markets.
International comparisons
The State of Israel is also much stricter in terms of legal approach to games of chance—for example—compared with countries such as the UK or Australia, where gambling is legal but very regulated. Online casinos, sports betting, and land-based casinos are all closely supervised by a government in these countries, and it is viewed as a big part of their economies.
However, Israel’s laws on gambling are more in line with countries like Saudi Arabia and Singapore, whose laws have, due to reasons either religious or cultural, tightly held the control of gambling activities. This is quite well elaborated by the example of Singapore, which has chosen the path of caution by allowing casinos only inside highly regulated resorts and has guaranteed that gambling does not affect the general population adversely.
Final thoughts
The regulation of gambling activities in Israel has basically mirrored the conservatism of the country. This has been based on state regulation, save for lottery and sports betting; other forms of gambling activities are banned, including casinos and online gambling. An underground market, however, is increasingly growing to show high demand in options for gambling among Israelis.
While the government is strict in regulating gambling, the government tries to block illegal sites that operate online, especially. Still, players find options to work around this, showing the continued challenge Israel has in regulating this sector.
With this in mind, the future of gambling from an Israeli perspective is probably not going to change too much now, as its current trajectory is running very similarly alongside the guiding hand of religious and cultural influence. Still, there might be a future debate on the expansion of legal options, taking into account the current discussion on liberalising the gambling market.
