Tabcorp pushes with tax reform in Victoria

The way Australia regulates its gambling industry has often been the subject of fierce debate. While each state is free to set its own rules of taxation, one operator, to name TAB, has been particularly vociferous and pointed about overseas and offshore companies having a considerable advantage over local counterparts.

This has stirred the pot once again with Tabcorp now insisting that Victoria does more to level the playfield. The company wants Victoria Treasurer Tim Pallas to make sure that the government collects more taxes calculated on gambling losses from the likes of Sportsbet and other non-Victoria-based entities.

Presently, the point of consumption tax is a mere 10% in Victoria, and it actually took some back-and-forth to get it to that. Originally, the tax was launched at 8%. All this time, companies, and mostly Tabcorp, have been trying to explain to the government that entities that hold licenses elsewhere were able to remit their money abroad and pay tax there.

So, what is it that Tabcorp wants? According to the company, it wants a leveler playfield, something that the company has been nudging other state governments to do.

As we previously reported, Queensland has already decided to increase the POCT tax to 20% from 15% previously, which is actually partially the achievement of Tabcorp itself. This taxation model seems to untie Tabcorp’s hands and make it more competitive against other digital bookies.

The company now wants the same to happen to Victoria as well. A Victorian government spokesperson has already said, though, that any changes to the POCT tax rate may only come after careful review and will always be enacted in the interest of the state and its racing industry.

The issue seems to be with how companies operate and where they are licensed. For example, Ladbrokes, Sportingbet, and Neds are all licensed in the Northern Territory, where taxes are clearly lower. These companies, though, continue to operate nationally, which means that they have the opportunity to remit their profits overseas.

Meanwhile, Tabcorp has been attempting to secure some help from local gambling and anti-gambling organizations. Responsible Wagering Australia, an online bookmaker lobby group, has naturally said that it would not support any increase in the POCT tax rate.

However, Tabcorp has followed the "enemy of my enemy" tenet and has formed a mutually beneficial partnership with the Alliance for Gambling Reform, which actually wants to see the tax overhauled. The organization is also looking into other aspects of the industry and is generally hawkish on the gambling industry, but this is beyond the point for Tabcorp at present time.

After success in Queensland, Tabcorp feels like it has the momentum to continue trying to enact changes in the taxation system.

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