Is online casino legal in Japan?
The 2025 law change, prosecution data, and tax treatment

TL;DR

• Playing offshore online casinos from inside Japan is illegal, regardless of where the operator is licensed.
• Applicable laws: Penal Code Article 185 (simple gambling, fine up to ¥500,000) or, with habitual conduct, Article 186(1) (habitual gambling, up to 3 years' detention).
• The National Police Agency and Cabinet Office have explicitly rejected the "offshore-licensed = grey zone" framing.
• The amended Basic Act on Measures against Gambling Addiction (in force 2025-09-25) prohibits creating affiliate ranking sites linking to online casinos.
• 2024 saw 279 individuals arrested (+160% YoY) for online casino activity. 2025 saw the first arrests of affiliate operators.
• Winnings are treated as 一時所得 (one-time income) for tax. Net income above the ¥500,000 annual deduction is taxable — including income from illegal sources.

Japan's gambling law: structure

Gambling in Japan is prohibited by Chapter 23 of the Penal Code (賭博及び富くじに関する罪). "Gambling" is defined in case law as "two or more people contesting gains or losses of property or property-equivalent advantage on the basis of an uncertain event." Betting any financial value on the outcome of a contest falls under this definition.

Lawful exceptions are limited to gambling forms specifically authorised by other statutes:

Category	Examples	Authorising law
Public competitive racing	Horse racing, keirin (cycling), boat racing (kyōtei), auto racing	Horse Racing Act, Cycling Act, Motorboat Racing Act, Small Auto Racing Act
Lotteries	Takarakuji, sports lottery (toto / BIG)	Public Lottery Tickets Act, Sports Promotion Lottery Act
IR casino	Osaka IR (planned 2030)	Integrated Resort Act
Pachinko / pachislot	(Cash redemption via the "three-shop method")	Entertainment Business Act

Online casino does not fall under any of these. There is no statutory basis for treating it as legal.

Penal Code Article 185 (simple gambling)

Article 185 A person who gambles shall be punished by a fine of not more than ¥500,000 or a 'kōryō' (small fine). This shall not apply, however, to the extent that what is staked is for momentary entertainment.

Key points:

• "A person who gambles" means a participant — the player, not the operator. Players are the target of this article.
• Fine up to ¥500,000 or kōryō. Kōryō is a small fine of ¥1,000–¥10,000, lighter than a regular fine.
• The "momentary entertainment" exception covers things like food and drink consumed during a casual game. Cash, cryptocurrency, or any redeemable value does not qualify.

The article has been applied historically to bets on mah-jong, video games, and many other contexts. Online casinos — which centre on "contesting wins and losses with real money or its equivalent" — fall squarely within the offence.

Penal Code Article 186 (habitual gambling and operating a gambling place)

Article 186(1) A person who habitually gambles shall be punished by a detention sentence (拘禁刑) of not more than 3 years.

Article 186(2) A person who opens a gambling place or organises gamblers and seeks to profit shall be punished by a detention sentence of not less than 3 months and not more than 5 years.

Note: The June 2025 Penal Code reform consolidated 懲役 (with-labour imprisonment) and 禁錮 (without-labour imprisonment) into a single 拘禁刑 (detention) sentence.

• Article 186(1) habitual gambling applies to repeated play. Continuing account use, using multiple operators, regular deposits and withdrawals — these establish habituality.
• Article 186(2) opening a gambling place applies primarily to operators and organisers of online casinos. A Japan-resident operating a casino targets this offence.

Aiding and abetting (賭博幇助) and the scope of liability

Penal Code Article 62(1) states "A person who aids the principal is an accessory." Acts that assist gambling can be prosecuted as accessory to the gambling offence. The Cabinet Office's November 2024 statement names three categories of conduct that may constitute aiding and abetting:

Conduct related to the use of online casinos — for example, payment processing, advertising, and site recommendation — may constitute aiding the gambling offence. — Cabinet Office (gov-online.go.jp)

Typical examples of aiders that have been prosecuted:

• Payment processors — entities intermediating funds between players and casinos
• Affiliate operators — operators of "best online casino top 10"-style ranking and review sites
• Advertisers and ad creators — publishers and creators of paid online casino advertising
• Organised promoters on social media — those organising others to use online casinos

Accessory liability carries a maximum penalty within the principal's range, but reduced (Article 63). For the principal offence of habitual gambling, this means up to about 1 year 6 months' detention. Actual sentencing varies with conduct, criminal history, and the scale of harm.

Why offshore licensing does not help (territoriality principle)

Many online casinos hold licenses from the Malta Gaming Authority (MGA), Gibraltar, Curaçao eGaming, the UK Gambling Commission (UKGC), and similar bodies. These attest to the legality of the operator in the issuing jurisdiction. They do not authorise Japanese players to use them.

Japan's Penal Code applies the territoriality principle (Article 1) — Japanese criminal law applies to any crime committed within Japan, by anyone. Accessing an online casino, placing bets, and resolving outcomes — performed by a player physically located in Japan — counts as gambling carried out in Japan.

From the NPA's own explanation:

Gambling from within Japan on online casinos — even where those casinos are legally operated overseas — is a crime. — National Police Agency (npa.go.jp)

This applies to paid play, free play, and bonus-credit play alike. The NPA explicitly states that play with redeemable bonus credit counts as gambling. The test is "did you bet anything of property value" — and a withdrawable bonus credits has property value.

The "grey zone" narrative is dead

From roughly the 2010s through the early 2020s, online casino operators and affiliate marketers in Japan circulated a claim along the lines of "the operator is licensed offshore, so this is a grey zone for Japanese players." The Japanese government has now publicly rejected that claim.

• Cabinet Office, gov-online.go.jp (November 2024): "There is no 'grey zone' to the illegality of online casinos." (source)
• NPA official X (@NPA_KOHO): "There is no 'grey zone!'"
• NPA-commissioned 2025 study report: "Whether or not the activity is legal in the country of operation, gambling carried out from inside Japan is a crime." (PDF)

A May 2025 paper by University of Tokyo Professor Takashi Hashizume (hosted on soumu.go.jp) reaches the same conclusion through statutory analysis. Major Japanese law firms (Miyake, Growth, etc.) have published consistent positions.

What the 2025-09-25 amendment did

In June 2025 the Diet passed amendments to the Basic Act on Measures against Gambling Addiction (ギャンブル等依存症対策基本法), in force from 2025-09-25. The amendment strengthens addiction policy generally; for online casinos, the most material change is:

Conduct promoting illegal online gambling is now expressly prohibited

The NPA cites the following as a concrete example of newly prohibited conduct:

Creating summary sites that introduce online casinos (e.g., creating sites titled "Top 10 Recommended Online Casinos" with embedded links to online casino sites is also a prohibited act). — NPA (npa.go.jp)

This statement specifically names the affiliate-ranking-site format. DrollWolf publishes this disclosure prominently so readers understand the legal environment in which both casino operators and review sites operate.

Strengthened obligations for related businesses

• Banks and payment processors: clarified duty to block fund transfers to illegal gambling sites
• Telecoms and platform operators: expanded framework for access blocking on illegal sites
• Advertisers: explicit prohibition on handling illegal gambling advertisements

Stronger addiction policy

• Mandatory addiction-policy plans at the prefecture / designated-city level
• Strengthened treatment and consultation infrastructure
• Mandatory youth protection education

The amendment does not create new criminal penalties; it strengthens administrative guidance and the social obligations of related businesses. However, conduct now explicitly named as "prohibited" feeds the case-law interpretation of accessory liability under existing Penal Code provisions — raising the practical likelihood of prosecution.

Enforcement statistics and prosecutions

2024 enforcement statistics

From the NPA's 2024 study of online casino activity in Japan:

• 2024 online casino arrests: 279 individuals (+160% YoY)
• Majority are user / player arrests
• 2025 sees increasing arrests of operators, affiliates, and payment processors

Notable case: the "Onkaji Hissho" prosecution

In 2025, Hisato Yonezawa (alias) and a co-defendant were arrested under habitual-gambling-aiding charges for operating an affiliate site that directed users to a Curaçao-licensed online casino. Reporting indicates:

• Approximately 670 customers referred via the affiliate site
• Estimated ¥70 billion in total bets channelled
• Charged under habitual-gambling-aiding (常習賭博幇助罪), recognising the organisational scale beyond standard accessory liability

This case is the first high-profile criminal prosecution of affiliate site operators specifically and indicates that the "we aren't gambling, we're just publishing" defence does not work in practice.

2025 enforcement pattern

Through 2025, the NPA reports 25 arrests across 8 cases involving operators, affiliates, and payment processors. The enforcement target is widening from "users only" to the broader business ecosystem.

Tax (一時所得 / one-time income)

Winnings from online casinos are generally classified as 一時所得 (ichiji shotoku, one-time income) under Japanese income tax law. Income from illegal activity is still subject to tax — National Tax Agency Basic Notification 36-15 states that illegal income is taxable.

Calculation

One-time income = winning amount − cost directly required to obtain that winning − special deduction (up to ¥500,000)

The critical interpretation is "cost directly required to obtain that winning." Per the National Tax Agency guidance after the horse-racing tax cases at the Supreme Court, only the stake of the winning bet is deductible as a necessary expense. Stakes on losing bets are not deductible (with the limited exception that the Supreme Court has, in highly continuous and systematic horse betting, sometimes recognised "miscellaneous income" treatment which allows losses to offset).

Filing thresholds

• Salaried employees: filing required if one-time income exceeds ¥200,000 taxable amount
• Self-employed / pensioners: filing required where combined with other income exceeds ¥480,000 (basic deduction)
• Resident tax: many municipalities require declaration of any amount

Will the National Tax Agency learn about the illegal nature?

Tax authorities generally focus on income existence rather than legality, but suspicious foreign remittances (including crypto) are part of the tax / financial / immigration data-exchange framework. Not filing creates separate exposure as tax evasion — a 40% heavy-additional-tax can apply, on top of the underlying tax. The integrated stance is: declare illegal-source income for tax, and resolve the legal question separately.

Get specific advice from a tax accountant. Specialists handling online casino and crypto declarations exist and are growing in number.

Compared with legal Japanese gambling

For reference / comparison — and for readers looking for a legal way to bet — Japan permits the following:

Category	Payout % (approx.)	Online betting?	Operator
Horse racing (JRA / NAR)	~74–80%	JRA-PAT, Rakuten Keiba	JRA / regional
Keirin (cycling)	~75%	K-Dreams, Chariloto	Municipalities
Kyōtei (boat racing)	~75%	Teleboat	National motorboat assoc.
Auto racing	~70%	Oddspark	National assoc.
toto / BIG (sports lottery)	~50%	Official site	Japan Sport Council
Takarakuji (lottery)	~47%	Official site	Self-government lottery board
Pachinko / pachislot	~80–90%	Land-only	Parlour (3-shop)

What players should consider

1. Understand your exposure. The information here is meant to help you make an informed decision — not to encourage participation.
2. If you have past winnings, consult a tax accountant about prior-year filings (一時所得 declaration).
3. If you or someone you know shows signs of dependency, please use the responsible gambling resources.
4. If you are contacted by police / prosecutors regarding online casino activity, contact a defence lawyer immediately. The Japan Federation of Bar Associations and Hōterasu can help locate counsel.

Frequently asked questions

Sources

Primary (government)

• National Police Agency: "Online casino is a crime"
• Cabinet Office gov-online.go.jp: "There is no grey zone" (Nov 2024)
• NPA-commissioned 2025 Online Casino Survey Report (Seed Planning Inc., n≈27,145)
• Penal Code (e-Gov)
• MHLW: Information for people affected by gambling disorder

Case law / academic

• Supreme Court, 2015-03-10 — horse racing tax case (income classification)
• Takashi Hashizume (University of Tokyo) — "A note on the regulation of online casinos" (May 2025, on soumu.go.jp)

Industry / law-firm commentary

• Miyake Law Office — "Criminal-law points on online casino"
• Growth Law Office — "Practical implications of the 2025 amendment to the Basic Act"
• Lexology Japan Gambling Overview 2025

Related on DrollWolf

• Responsible gambling — screening and resources
• Payment methods — JCB, PayPay, bank, crypto
• Sportsbook legal position
• DrollWolf editorial policy and advertising disclosure

About this page: Primary-source-led explainer reflecting the 2025-09-25 amendment. Laws, notices, and case law evolve. Verify against current primary sources and consult licensed professionals for material decisions.