New South Wales opts for 10% POC tax
NSW goes against the grain with lowered POC tax to avoid “excessive burden” on market operators
The New South Wales (NSW) government has confirmed the introduction of a 10% point-of-consumption (POC) tax on online betting and gambling services in the state.
The new POC tax will take effect from 1 January next year, with the government set to review its performance after 18 months.
The tax reportedly aims to bring international operators in line with the likes of Tabcorp in terms of how much tax they pay, as most online gambling companies are headquartered in the Northern Territory (NT) and pay small fees in comparison.
NSW treasurer Dominic Perrottet said: “The introduction of a POC tax is an important step to ensure that we are levelling the playing field given the wagering tax paid by onsite operators.
“Following an extensive consultation period with stakeholders, this decision will resolve the disconnect between the jurisdiction where gambling activity occurs and where it is taxed.
“We also want to make sure that the horse racing industry is no worse off under these changes, which is why we have taken steps to ensure that they receive fair compensation and that existing parity arrangements are unchanged,” he added.
The 10% NSW tax rate will be the second lowest in the country after Victoria. Victoria is Australia’s premier horse racing state and voted through an 8% POC tax in May.
South Australia was the first of three states to introduce a 15% rate of tax, shortly followed by the Australia Capital Territory and Queensland, which voted through the proposals yesterday.
Tasmania is the only state yet to commit to introducing a POC tax, while Western Australia has not confirmed a final rate.
“We think 10% strikes the right balance and that online corporate bookmakers should contribute their fair share,” said Perrottet.
“However, a 15% additional tax on top of GST and race field fees would be an excessive burden on players in the market,” he added.