South Australia has announced its intention to introduce a new 15% gaming duty which will affect betting groups that serve the state's gambling public.
The new place of consumption tax will come into effect in exactly one year and will be included in August's state budget. The state is expected to raise over $9.2 million each year from the tax - $500,000 of which will be earmarked for South Australia's gamblers rehabilitation fund.
The gambling tax will be imposed on betting companies which earn more than $150,000 each year. All bets placed in South Australia with Australian-based betting companies will be liable for the levy.
Gambling Tax Needs to Evolve
According to South Australia's state treasurer, Tom Koutsantonis, the betting industry is changing rapidly and therefore the tax regime needs to change with it.
"If betting companies are making profits from South Australian punters they should be paying tax in South Australia, not in whichever jurisdiction their head office and servers happen to be located," he explained.
"By implementing a wagering tax based on the place of consumption, we are ensuring that businesses are paying taxes in the jurisdiction in which they are making their money."
Gambling Tax Reform
The South Australia Council of Social Services were the first to call for gambling tax reform, as well as the implementation of this new model of taxation on betting companies.
The new tax will apply to bets placed on different types of racing such as horse, harness and greyhound racing. Betting on sports such as cricket, soccer and AFL will also be taxed, while novelty betting such as political and entertainment betting will also not be immune to the new point of consumption levy.
The government assured the racing industry that it would be “no worse off" because of the introduction of the new tax.