The Government of the largest Australian state has officially announced a 5% increase to the point-of-consumption tax (POCT) on corporate sports betting operators. As a result of the development, the tax is set to increase from 10% to 15%, with the new rules on the point-of-consumption tax in New South Wales (NSW) set to be effective on July 1st, 2022.
The cited tax increase in the state has come as part of the NSW Government’s new budget. According to reports, the change is set to mostly affect foreign online sportsbooks but estimates provided by the competent authorities have said that it will bring an additional tax revenue of AU$740 million on an annual basis.
As previously reported by Casino Guardian, the biggest gambling operator in Australia – Tabcorp – which currently has more than 5,000 employees, welcomed the new tax changes announced by the local Government. Adam Rytenskild, who currently occupies the position of CEO and managing director of Tabcorp, stated that the implementation of the increased point-of-consumption tax represents a significant step forward to level up “the playing field” in New South Wales. He further noted that online sports betting operators will now be required to pay larger POC taxes and the money is set to be used for further investments in the local gambling sector.
Recently, Tabcorp’s investors supported the spin-off of the company’s lottery business into a separate entity called the Lottery Corporation. According to the company’s executives, the demerger would help the operations of both entities and would make them more successful.
Queensland to Also Bring Changes to Point-of-Consumption Tax on Racing
As mentioned above, the change in the point-of-consumption tax is set to bring an extra tax revenue of AU$740 million. More than one-third of it –AU$265 million – is set to be invested back into the country’s racing industry.
However, not everyone welcomed the changes as enthusiastically as Tabcorp. Foreign sportsbook operators, such as bet365, Entain, PointsBet, and Sportsbet, have raised a red flag, saying that the new plan raises serious questions regarding accountability and due process. The CEO of Responsible Wagering Australia, the independent peak body for betting service providers licensed in Australia, Justin Madden, stated that the Government of New South Wales is engaging in shady deals without consultation.
NSW is not the only state that has been considering the implementation of an increase in the taxes that apply to the licensed operators. Earlier this month, the Government of Queensland also unveiled a decision to implement a new 5% point-of-consumption tax on racing. As explained by the minister for trade and investment and Queensland treasurer, Cameron Dick, such changes are set to ensure more certainty in the state’s racing sector.
Tabcorp once again welcomed the announced changes in the POCT in Queensland, with a representative of the company stating that the adjustments were necessary as they provided both the racing clubs and the state with more opportunities.