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Australia to Introduce Betting Point of Consumption Tax
- March 27, 2017 By Oliver Young -
Australia is at the centre of news once again, after last week’s information that the country intends on limiting the amount of gambling ads on TV. Australia is one of the most gambling nations in the world, but there is not clear consensus yet as to what would the restrictions mean and whether there would be any impact on the industry.
It appears that the Australian Government has an intention to change several legislation acts regarding betting and gambling which became evident after it was announced that the federal Government intends to set a country-wide sports betting point-of-consumption taxes. The announced intention of the move is to give operators and punters throughout the country equal opportunities and fair conditions.
Such a Proposal Has Already Been Mentioned
If the Government goes through with the proposal and a new state-wide tax is adopted, it is clear that the decision will cause a severe hit to Australia’s Northern Territory, a territory which is the top licencing jurisdiction in the country, despite the fact that it is the most sparsely populated of all states and territories.
The intention to introduce a new tax rate has been announced by Scott Morrison, who is in charge of Australia’s Federal Treasury. Morrison in a media statement said that the country should take steps towards adopting a consistent approach and a state-wide solution for betting point of consumption tax (POCT). A similar solution has already been proposed by the Council of Social Services.
Morrison added that the reasoning behind the proposal wasn’t to raise the tax revenues in order to fill the state coffers, but rather to ensure that the both the punters and the state sporting bodies and their interests will be protected.
It has to be noted that there are states which have already endorsed the idea of a state-wide POCT. South Australia was the first state to do so and in 2015, the state’s Treasurer expressed the idea that betting and gambling operators should pay taxes to South Australia on the profits that they make from South Australian punters and their wagers. This state has introduced a state 15% POCT which will be enforced from July 1 2017 onwards.
The Northern Territory Will Likely Oppose the Plan
The Federal Treasurer said that the plan developed and introduced by South Australia is a good starting point. It has been reported that most states and territories have already agreed to discuss the matter and that each of the state Governments will report to the federal Government. The only exception is the Northern Territory, and it is obviously not happy with the proposal.
Most of the Australian sports betting operators are licenced and based in the Northern Territory after it developed a favourable tax scheme that attracted them. However, most of the other states feel that the Northern Territory unrightfully benefits from the wagering contributions of their residents.
The Treasure didn’t mention a time frame when the new proposal might be enacted, as the country has yet to deal with some other issues regarding betting and gambling including changes in the regulation concerning in-play betting, TV advertising and other matters.
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