Online Firms Try to Stave Off Vic Tax

Online gaming providers in Australia are lobbying to keep the state of Victoria from adopting a 15 percent tax on internet betting. The point-of-contribution tax is already being implemented elsewhere Down Under.

Bookies hope Victoria will stand against levy

Australian bookies are pushing back at a proposed 15 percent tax on online betting under consideration for the Australian state of Victoria. According to the Sydney Morning Herald, Queensland recently announced it would become the third jurisdiction to add the point-of-consumption tax, which is already a reality in South Australia, and in the pipeline for Western Australia in the new year.

“Not many bookmakers would even be making a 15 percent margin on their wagering” if the tax is enacted, griped one bookmaker to the Herald. “The downstream consequences for the wagering industry and consumers are very real.”

The bookie added hopefully, “We think the Victorian government is going to pay more attention than the other states have.”
Corporate bookmakers licensed in the Northern Territory say they are a significant economic driver in the region, adding other taxes as well as jobs, wages, product fees they pay to sporting codes and race-field fees paid to state racing bodies. Racing Victoria’s latest annual report shows revenue from race-field fees in the past financial year reached $157.5 million.

Supporters of the new tax say it will “level the playing field” for gaming operators because totalizator providers Tabcorp and Tatts have to pay far higher taxes than online corporate bookies.

Trade group Responsible Wagering Australia, which represents Sportsbet, CrownBet, Bet365, Betfair, Ladbrokes and Unibet, slammed the plan as a “naked tax grab” that does not factor in the industry’s “significant contribution to the economy.”

“In the last financial year in Victoria, RWA’s members employed more than 900 people, paid more than $127 million in wages, contributed $78 million to the racing industry and paid more than $11 million in sponsorships to support Victorian events and tourism,” a spokeswoman said. A report from Credit Suisse earlier this year said a similar tax introduced in England in 2014 seriously undercut industry profit.

Meanwhile, a Sydney council is appealing to the New South Wales state government to cap poker machine licenses in the area. Members of the Northern Beaches Council called for other councils in the state to do the same.

“The state government of both political persuasions has been addicted to poker machine revenue for too long now, it’s causing great harm to the community,” Liberal Councillor Pat Daley told the Australian Associated Press.

Australians lost a record $24 billion on bets in 2015-16, with pokies losses growing 4.2 percent, roughly double the rate of inflation. Sports betting remained the fastest-growing form of gambling, the Herald reported.

Pokies accounted for the largest share of losses ($23.6 billion), followed by casinos ($5.2 billion), racing ($2.9 billion) and Lotto ($1.9 billion). An anti-pokies lobby group, the Alliance for Gambling Reform, wants the government to enact measures that will reduce the overall losses to under $20 billion, said spokesman Tim Costello.

“Whilst sports betting is top of mind with the advertising deluge … the latest national figures once again confirm that the pokies are easily the biggest contributor to Australia’s tragic status as the world’s biggest gamblers.”

According to the latest statistics, New South Wales has the most poker machines of any state and had the biggest increase in pokies losses in 2015-16, up 6.2 percent.