The Victorian Government has announced that as of January 1 2019, it will impose an 8% Point of Consumption Tax (POCT) on all wagering and betting. It forecasts to gain $30 million in annual revenue. Read on.
The New Online Gambling Tax
Online betting losses in Victoria will be taxed at the lowest rate in Australia. The news was recently announced by Victorian treasurer, Tim Pallas. The new point of consumption tax will be 8% of a bookmaker’s monthly winnings and will apply from January 2019.
Last year, South Australia levied a 15% consumption tax on online gambling. Western Australia and Queensland also flagged their intention to tax online betting at the same rate.
Gambling Tax Model Criticised
Responsible Wagering Australia (RWA), a gaming group responsible for CrownBet, Betfair, Sportsbet, bet365, Unibet and Ladbrokes, said the decision was disappointing and that it would “have significant negative and far-reaching consequences”.
“An 8% POCT does not adequately account for these significant contributions and will result in Victoria having one of the highest effective wagering tax rates in the world,” said a spokesperson.
Australia accounts for around 5% of the total global spend on online betting. In the country alone, online gambling is estimated to be worth more than $2.4 billion annually.
RWA says the online industry, which employs more than 1000 Australians in Victoria, paid the state government $6 million in payroll tax plus $80 million to the Victorian racing industry in the last financial year.
State Confident About the Move
Pallas says the Victorian state government wants to work with other Australian states and territories on a common model for POCT. The government has vowed that the state’s racing industry will not be worse off due to the newly introduced tax.
“Online betting and wagering agencies take a huge amount of money out of Victoria,” said Pallas. “It’s time they started making a fair and proper contribution,” he added.
The annual tax revenue will go towards charities and hospitals.