Illegal Gambling in Thailand: How a $31 Billion Annual Kickback System Operates

The Nation conducted a large-scale investigation into Thailand’s underground gambling industry, uncovering a complex kickback system that operates within the illegal gambling market, with an annual turnover of approximately $31 billion — completely bypassing the country’s official economy and tax system.

Annual Turnover and Market Structure

According to journalists and analysts, Thailand’s illegal gambling industry generates over $31 billion per year, or roughly 1.1 trillion baht.

Of this amount, around $2.25 billion (80 billion baht) goes toward kickbacks that allow the business to operate outside the law.

Three-Tier Kickback System

Cash flows in illegal gambling follow a well-defined structure:

1. First tier: direct payments from operators to local “protectors” and influential figures.
2. Second tier: networks of officials — police, administrative staff, and local authorities.
3. Third tier: high-level beneficiaries — politicians and senior government figures.

The larger and more centrally located the establishment, the higher the cost of “protection.” These funds are untaxed, untracked, and the recipients are effectively beyond the reach of the law.

Why Doesn’t the Government Intervene?

One of the most pressing questions is why such a vast system operates without government interference. Analysts attribute this to a phenomenon called “political inertia”, where the authorities are either unwilling or unable to change the status quo.

Experts estimate that legalizing and taxing the gambling industry could bring in up to $6.2 billion (220 billion baht) per year to the national budget. However, this money currently fuels political and criminal networks instead.

The kickback system serves as a financial resource for power struggles, campaigns, and influence-building. According to former law enforcement officials, “the only way to dismantle such a network is to remove its protectors.”