South Australia pitches online betting tax to state ministers

SOUTH Australia has looked to push its online betting reforms nationwide by urging ministers from other states to adopt similar tax laws.

As of July 1, 2017, all Australian bookmakers, no matter where they are licensed, will be taxed 15 per cent of revenue from betting activity conducted in SA.

These new ‘place of consumption’ laws are designed to sting online bookies – most of which are regulated in the Northern Territory – with the same tax obligations as retail betting giants Tabcorp and Tatts.

In a meeting between Australia’s state and territory ministers last Friday, South Australian treasurer Tom Koutsantonis pitched the idea as an obvious coffer-filler that would bring in millions of dollars to fund gambling treatment and addiction awareness initiatives.

“While the harm of online gambling is done in SA, the profits on those bets are taxed in whichever jurisdiction the betting company is based, whether that in the Northern Territory, or some other place,” he told Adelaide independent news network InDaily.

“[And] our health workers and community service organisations are left to clean up the mess, while online betting providers protect their super profits in tax havens.

“Gambling has evolved and the way in which we legislate and tax betting companies has to evolve with it… this is a common-sense reform that I think should be embraced across Australia to help Australian governments manage the harm that is done through gambling.”

South Australia’s move has met with unsurprising opposition from online bookmakers, with Sportsbet axing plans for a new $20 million data complex in the state and withdrawing sponsorship from a number of local sports teams.

But Ross Womersley, chief of the SA Council of Social Service, said the legislation was an “essential” step in the absence of any such initiatives at federal level.

He did acknowledge, however, that other states and territories may hold fire on any changes given the “entirely likely” scenario that the corporate bookmakers would take matters to court.

“It’s been [the betting operators’] habit to treat these matters as largely legal disputes and throw considerable sums of money at them, given it’s their profits that are likely to be impacted on,” Womersley said.

The Koutsantonis pitch wasn’t the only major initiative discussed at Friday’s meeting in Melbourne.

State and territory ministers also agreed in principle to a National Consumer Protection Framework in a bid to combat problem gambling.

The agreement’s key points include a national self-exclusion program, a voluntary pre-commitment scheme and a ban on credit betting with online wagering services.

“Most people gamble responsibly, they enjoy a punt and hundreds of thousands of people do so every day, but there are some people who literally bankrupt themselves,” Human Services Minister Alan Tudge told the ABC.

“At the moment in some jurisdictions, online gambling companies can offer a line of credit to their customers, when the customers run out of money.

“We feel as if there is a complete conflict of interest between gambling companies both being a provider of gambling services and effectively a bank, giving a line of credit to continue using their services, using credit.

“We think this shouldn’t be allowed.”

What we think of the online betting tax

There is some sense in South Australia’s push to capture gambling revenue from online bookmakers.

Why should the NT reap the rewards, however small the percentage, from punters based in another state?

But don’t be fooled into thinking there is any humanitarian or philanthropic substance behind these new laws.

Governments love money, and that’s what this is all about.

Why do you think the states and territories are so keen to keep their poker machines?

Only a tiny fraction of all those billions in gaming revenue goes towards funding public health programs for gambling-related issues.

Look beyond the rhetoric and it is plain that this is all part of the push to ensure Tabcorp and Tatts remain the despot giants of Australian gambling.

The major betting retailers have started to lose their grip on the market amid the rise of online and mobile betting, but the federal government seems determined to make them untouchable once again.

Proposed amendments to the 2001 Interactive Gambling Act would give Tabcorp and Tatts – which are set for an $11 billion merger – unprecedented advantages over internet-only wagering operators, especially with regards to live in-play betting.

Combine that with these tax initiatives and it’s pretty clear which way the wind is blowing.

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