In last week’s State Budget, the South Australian Government implemented a new tax on betting companies in a bid to raise $9.2 million in additional revenue a year. The ABC explains:
The State Government will introduce a so-called “place of consumption” tax of 15 per cent on the net wagering revenue of all betting companies offering services in SA.
It is the first time an Australian jurisdiction will target betting companies based upon where bets are placed, as opposed to where the betting provider is located.
Treasurer Tom Koutsantonis said the tax would apply to bets on horse, harness and greyhound racing, and other sports such as AFL and soccer, from July 1, 2017.
It will also apply to bets such as those on the winner of federal elections or the Academy Awards.
“The betting industry is rapidly changing and our tax regime needs to change with it,” Mr Koutsantonis said.
“If betting companies are making profits from South Australian punters they should be paying tax in South Australia, not in whichever jurisdiction their head office and servers happen to be located”…
A tax-free threshold of $150,000 is proposed for all betting companies.
Now, the Victorian and New South Wales state governments are also considering imposing similar taxes on betting companies. From The AFR:
NSW is leading the charge to shift to a nation-wide consumption tax on gambling that could reap states and territories hundreds of millions by cracking down on NT registered online bookies.
The NSW budget last week said it was investigating introducing a similar consumption tax to that which starts in South Australia on Saturday. The Victorian Budget papers from early May also confirmed that state is working towards adopting the same tax…
Sources have indicated the Victorian government has estimated a gambling consumption tax would reap it about $130 million per year, a figure that would be even higher in NSW…
A NSW Treasury spokesman said… “The harm from gambling occurs at the point of consumption, so a point of consumption tax allows for the alignment of gaming tax revenue, some of which can be applied to addressing social costs.”
The states already levy taxes on poker machines and casinos. So it makes sense on competitive neutrality grounds that they also levy taxes on other forms of gambling, such as online bookies.
