South Australia calls for 15% betting tax

For years South Australian independent Senator Nick Xenophon has been loudly rallying against the pokies, and now gambling operators in the City of Churches have a new hurdle in the mix.

The latest South Australian state budget includes a provision that aims to generate up to AUD $6.85 million per year with the institution of a new 15% government tax on all wagers. If implemented, the tax will apply to all online betting operators and bookies, on all bets placed by SA residents on horseracing, greyhound racing, sports betting and even novelty bets like predicting the outcome of the federal election or the winners of certain award ceremonies. Known as the “place of consumption” tax, it aims to apply to all bets placed within the state even if the operator is located in a different jurisdiction.

Treasurer for South Australia, Tom Koutsantonis told the Australian Broadcasting Commission, “The betting industry is rapidly changing and our tax regime needs to change with it. 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 report from the Australian Broadcasting Commission states this is the first instance of an Australian jurisdiction targeting betting operators over the location the wager is placed rather than the location of the operator. If the 15% place of consumption betting tax is passed, it will be levied on all net wagering revenues offered in South Australia. The report from the ABC alleges that the first AUD $372,550 generated from the tax each year will straight towards the Gambling Rehabilitation Fund which provides support to problem gamblers and their families.

The Executive Director for the South Australian Council of Social Service, Ross Womersley, told the ABC, “One of the things we identified is that with the rise of sports betting in Australia and online betting, lots of the taxation related to that betting was paid in other jurisdictions, effectively tax havens, in particular the Northern Territory and Norfolk Island, both of which have very preferential arrangements for taxation.”

If the place of consumption gambling tax is passed, it will apply to all bookmakers with South Australian licensing, like Ubet, as well as interstate and offshore operators like Ladbrokes and Sportsbet, with a tax-free threshold of $111,763 for all operators. Koutsantonis emphasised that the racing industry would not be adversely affected by the proposed levy.

The proposed levy was revealed just days before the shock announcement of the New South Wales ban on greyhound racing, proving there’s a lot of change in the waters for the state of gambling in Australia.

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