2nd Reading Speech
23 October 2018
The Hon. ADAM SEARLE (22:40): I lead for the Opposition on the Betting Tax Amendment (Point of Consumption) Bill 2018. The bill provides for a 10 per cent point of consumption tax to be applied to all betting operators wagering revenue derived from New South Wales activity—that is, as I understand it, racing meets located in New South Wales. The bill also provides for an additional funding stream to be provided to the racing industry equal to 2 per cent of all taxable net New South Wales wagering revenue each year. The bill also provides the formula for distributing the new revenue to the three codes: Racing NSW is to receive 72 per cent, Harness Racing NSW 15 per cent, and Greyhound Racing New South Wales 13 per cent, which is in accordance with the proportions for the distribution of amounts under the racing inter-code deed entered into in 1998.
The proposed arrangement will fit with existing arrangements for betting tax payable by the New South Wales Totalizator Agency Board [TAB]. Existing arrangements will remain in place but the NSW TAB operator will be able to offset any betting tax and tax parity payments made in a given financial year against its liability under this legislation. Accordingly, as I understand it, the revenue raised under this legislation is a tax contribution made entirely by corporate bookmakers, as opposed to the NSW TAB. It is estimated by the Government that this tax will raise approximately $100 million in annual revenue for the Government—$40 million of this will be distributed back to the three racing codes. Again as I understand it, horseracing and harness racing are supportive of the bill in its current form; however, the greyhound breeders, owners and trainers have some concerns with the bill.
The concerns are twofold. One relates to the rate of the taxation. They would like to see the tax reduced from 10 per cent to 8 per cent, which is in accordance with the rate at which it is levied in Victoria. As I understand it, the essential basis of the concern is that if corporate bookmakers are hit with additional costs it may impact their ability and willingness to sponsor and invest in the greyhound racing industry. In addition, the greyhound racing industry has proposed that the revenue from the tax should be distributed in the same proportion as the tax is generated by each of the codes. Rather than using the inter-code distribution methodology, they propose that it be distributed according to market share.
I note that there are competing views about how market share should be assessed, which I will not go into at the present time. However, I can indicate that the Opposition did move an amendment when this bill was debated in the other place. This amendment went to the second of these two issues, and I indicate that the Opposition does support a change to the legislation to distribute the new revenue in accordance with market share rather than the inter-code agreement. However, we will not support any proposed reduction in the rate of the taxation from the 10 per cent proposed in the bill to 8 per cent. I understand the Shooters, Fishers and Farmers Party will move four amendments. The first three of these amendments go to the rate of taxation issue, which we will not support. However, I can indicate that the Opposition will support amendment No. 4, which goes to using the market share method for disbursing or distributing the new revenue to the three codes. Otherwise, the Opposition does not oppose the legislation.