The Federal Government of Australia, and more specifically the federal Treasurer Scott Morrison, seems to be entering a fierce war with the country’s states over the plan of the Government to take part of their online gambling tax.
The state treasurers have shared their concerns that the Mr. Morrison announced plans to take part of the 15% point-of-sale consumption tax that has been introduced by every state, with such a portion being estimated to online gambling revenue estimated to hundreds of millions of dollars.
The issue is expected to become one of the most-discussed issues among the states in Australia right ahead of the treasurers’ national meeting at the Council on Federal Financial Relations that is scheduled to take place in two weeks.
New Point-of-Sale Consumption Tax
A common national approach in regards to the consumption tax was agreed in March, at the meeting of the Federal Treasurer and state treasurers. The treasurers shook their hands on consideration of a model that would provide the federal government with the right to oversee the process to make sure that the state-by-state tax is consistent. The only exception was made for the country’s Northern Territory.
Since then, the Australian Government has brought some clarity, saying that the Federal Government would expect to get a portion of the tax received by the states, with its value expected to be estimated to tens of millions of dollars.
The introduction of a point-of-sale consumption tax on online gambling operations would bring special tax revenue to the states where a bet is placed. Up to date, a number of leading gambling operators, including William Hill, CrownBet, Sporstbet and CentreBet, are registered in the Northern Territory of the country, where they take advantage of some favourable tax concessions.
Mr. Morrison has confirmed the Federal Government’s plans to take a percentage of the gambling tax imposed on local gambling operators, revealing that all proceeds would be used for funding sport. The Federal Treasurer further revealed that in case that the Australian states require from the Commonwealth to offer a national solution, the Government would want it to make sure it meets funding requirements for national sports instead of considering a national lottery.
Federal and State Governments’ Disagreements
What state treasurers do not agree with is the fact that the country’s Government would have the right to receive a percentage of the states’ tax. The money that would be gathered as a result of these taxes have been estimated to more than AU$130 million on an annual basis for the states of New South Wales (NSW) and Victoria.
Back in June, the Premier of South Australia – Jay Weatherill – announced that the 15% point-of-consumption tax imposed on gambling operators brought over AU$150,000, while the states of Victoria and New South Wales have shared they were to receive similar amount from taxes soon. As mentioned above, the estimated proceeds that are expected by the Government of Victoria to be brought would amount to approximately AU$130,000 on an annual basis.
The point-of-consumption tax is expected to be officially implemented in the state of New Sourth Wales in January 2019.