How does the Ontario government earn revenue from the regulated iGaming market?

Ontario's approach to earning money from the iGaming market is genuinely different from how most people imagine a government "taxing" an industry — and understanding the structure explains a lot about why the regulated market works the way it does.

The "conduct and manage" model: why there's no gaming tax

Canada's Criminal Code requires that any legal gambling operation be "conducted and managed" by a provincial government or its agent — a private company can't simply pay a tax and operate independently. Given Canada's particular legal framework, Ontario chose a revenue-sharing model in which its government entity enters into commercial agreements with private operators on behalf of the Province. That entity is iGaming Ontario (iGO), which became a stand-alone Crown agency when the iGaming Ontario Act was proclaimed into force on May 12, 2025.

iGO conducts and manages internet gaming with gaming operators via a commercial contractual relationship — an operating agreement — where the operator is accountable to fund and deliver all gaming operations required to generate igaming revenues in accordance with the terms of the agreement. In plain terms: the operators run the platforms and absorb the operational costs, but they do so legally because iGO is formally "conducting" the games. The gross gaming revenue (wagers minus player winnings) flows to iGO, and accounts payable to gaming operators consist of the 80% revenue share of gaming revenue that iGO returns to them. That leaves iGO retaining a share — which is then passed upward to the province.

How money reaches the province

iGO transfers most of its earnings in the form of a dividend to the Province of Ontario's Consolidated Revenue Fund. A share of revenues generated by these commercial relationships is returned to the Government of Ontario to support provincial priorities. But the direct iGO dividend is only one piece. The broader government revenue estimate includes taxes on products and production — such as HST, corporate and personal income taxes stimulated by Ontario's igaming industry — and the 20% government share of the gaming revenue generated by iGaming Ontario operators.

There's also a GST/HST dimension worth noting. Operator payments attract a 13% GST/HST obligation for iGaming Ontario, which is remitted to the Canada Revenue Agency. Some of that flows back: iGO's total contribution to the province represents its net income plus a portion of the GST/HST it pays to the federal government that is recovered to the Province of Ontario — iGO estimates approximately 37% of the GST/HST it pays to the federal government is recovered by the Province.

First Nations revenue sharing

The province doesn't keep everything. Pursuant to the Gaming Revenue Sharing and Financial Agreement (GRSFA), established between the Province of Ontario and its agents, the Ontario First Nations Limited Partnership, and the Ontario First Nations (2008) Limited Partnership (OFNLP), iGaming Ontario's gaming revenues are subject to revenue sharing payments to the OFNLP. The Province of Ontario directed iGO to pay the OFNLP monthly payments aggregating to an amount equal to 1.7 per cent of the prior fiscal year's unadjusted gross gaming revenue.

The scale of what this generates

The numbers have grown quickly. In 2024-25, $82.7 billion in total wagers generated $2.9 billion in total gaming revenue, representing an over 30% increase in both figures from 2023-2024. Across all revenue streams — the iGO share, HST, corporate taxes, and personal income taxes from the jobs the industry supports — Ontario's regulated competitive igaming market sustained almost 15,000 jobs and added a combined $1.24 billion to federal, provincial and municipal government revenues in its second year alone, with the third year's figures considerably larger.

For Torontonians playing on these platforms, this structure has a practical implication: "the revenue generated by Ontario's competitive igaming market contributes directly to provincial priorities such as infrastructure, healthcare, and education." It also means every operator you play with is operating under a formal agreement with iGO — not just holding a licence — which is why being a fully registered and authorized operator in the igaming market means the organization has successfully received a registration from the AGCO and executed an operating agreement with iGO, having met rigorous standards of game integrity, fairness, player protections and social responsibility. You can verify any operator's status on the iGaming Ontario registry at igamingontario.ca — and legitimate sites will display both the iGaming Ontario and BetGuard logos as confirmation they're part of the regulated scheme. The market is open to adults 19 and older; if you ever need support, ConnexOntario is available at 1-866-531-2600.