Everyone who has ever had anything to do with the gambling industry knows that bookmakers usually promise to provide players with free bets, refund their bets or double their deposit under certain circumstances. Such offers are usually accompanied by some disclaimers that clarify the conditions of the bonus that often cannot be used for anything except for playing more bets that could only cost more money to players.
However, such deals could become unavailable in Queensland because the money they provide punters with is now considered taxable revenue for gambling operators under some new pieces of legislation that were officially enacted on December 1st. As the Government revealed, the main objective of the laws is to provide improved and more reliable funding to the racing sector in the state.
Gambling operators, however, have reacted negatively to the changes, threatening to cut odds, cut back betting incentives in Queensland, or remove local races from their home screens.
Free Bets Will No Longer Be Tax-Free for Queensland Gambling Operators
So-called free bets, which are also known as credit or bonus bets, are the extra money players are given under the special promotional offers provided by bookmakers under certain circumstances.
Under the provisions of the updated gambling legislation in Queensland, free bets are officially described as bets that are partly or fully made by using an amount given by the betting operator to the punter, and with whom the bet is made. Furthermore, new rules state that free bets cannot be redeemed immediately by punters for cash. In other words, free bets are not real money that can be withdrawn from the online betting platform and used for anything else but making another bet.
The director of digital cultures at the University of Queensland, Nicholas Carah, explained that such special offers and bonuses are an extremely important part of betting operators’ marketing campaigns. He noted that such sales promotion activates the consumer.
Betting Companies Warn Higher Tax Rates Could Lead to Less-Attractive Odds
The aforementioned update of gambling laws would bring changes to the calculation of taxable betting revenue. For the time being, that is the money received by the company in bets minus the amount that is paid out as punters’ winnings. Free bets have not been included in the taxable betting revenue but under the new rules, they are set to be considered as part of the money received by gambling operators.
The implementation of gambling legislation updates basically means that betting operators will still be expected to pay tax on free bets.
Apart from that, new gambling laws also increase the tax rate from 15% to 20% by including a racing levy of 5%. Apart from that, about 80% of total wagering tax revenue is allocated to Racing Queensland, with the figure representing a 35% increase. According to Treasurer Cameron Dick, the update will provide a more sustainable funding model for the racing industry in Queensland. He explained that the tax is not a tax on punters but a levy on online gambling and betting operators and further noted that the industry would now have the certainty that it would get 80% of the betting tax.
The trade body representing legal gambling operators in the state’s gambling sector, including Entain, bet365, Betfair, Pointsbet, Sportsbet, and Unibet – Responsible Wagering Australia – noted that the changes brought to the Queensland laws could lead to less-attractive odds for customers. As mentioned above, in the months after the announcement was made some gambling companies have removed Queensland races from their home screens.
- Author
Olivia Cole
