Gambling Regulation Amendment (wagering And Betting Tax) Bill 2021
The Gambling Regulation Amendment (wagering And Betting Tax) bill is a handout to the racing industry, an increase in a wagering and betting tax that will go straight to the coffers of our wealthy horse and greyhound racing codes.
The following is a speech by Dr Tim Read, in the Legislative Assembly, on the 20th May 2021.
I would like to make some comments on the Gambling Regulation Amendment (Wagering and Betting Tax) Bill 2021. The tax increase contained in this bill is an idea that we support. But let us make no mistake: this bill is a handout to the racing industry, an increase in a wagering and betting tax that will go straight to the coffers of our wealthy horse and greyhound racing codes.
The Greens support fair and progressive taxation, such as this tax increase, and we support measures like the windfall rezoning tax announced in today’s budget, which taxes the unearned wealth gained by developers and property speculators after land is rezoned for development. We support the proper taxation of gambling revenue to ensure that the companies who profit from the exploitation of people pay their fair share.
We were pleased to see the government introduce this tax in 2018. Before the tax came into effect at the start of 2019 only Tabcorp paid a wagering tax in Victoria. This meant that online bookies were rapidly expanding their operations here without any fear of tax burdens, and they were preying on the increasing number of Victorians who chose to gamble online. Sports betting is still one of the fastest growing types of gambling in Australia and Victoria, with more and more of us betting on the races or other codes of sport every year. We saw this clearly last year when the number of people gambling and betting online rose during the COVID restrictions, especially among young men, and you can see the ads and how they are targeted towards that demographic.
In Victoria sports wagering and betting losses skyrocketed, with more than $1.4 billion lost by Victorians in the second half of last year. But when this tax was introduced the rate was set at 8 per cent. That was less than every other state. New South Wales had set theirs at 10 per cent and all the other states who introduced a tax set theirs at 15 per cent. At the time my Greens colleagues rightly criticised this move in Parliament. We pointed out that having the lowest rate in the country only encouraged online bookies to come and set up in Victoria, the tax haven of Australia, where they were free to peddle their dangerous and addictive products to consumers while barely having to pay any tax. So today we are pleased to see an increase in the rate of tax, creeping upwards from 8 per cent to 10 per cent. But although we now might share the dubious honour with New South Wales, we still have the lowest rate in the entire country. So we would ask why the government has not taken the opportunity to increase this further. Apart from New South Wales, every other state has a 15 per cent point-of-consumption betting tax. A 15 per cent tax would show this government was committed to proper taxation of harmful products and would address the rapid growth of online gambling as well.
We know the government is not afraid of progressive and fair taxation policy. Just look at the changes in today’s budget, where we have greater taxes on wealth, like new changes to land tax and the new windfall gains tax. So why have they left the rate at 10 per cent? The answer may be because this tax is not about fairness or preventing harm; it is really about the handout to the racing industry. As noted in the recent review of the operation of the point-of-consumption tax, our rate was set at 8 per cent to:
… minimise any potential negative effects upon the wagering and racing industries …
And it achieved its purpose. The review found that the current 8 per cent rate, plus the payment of almost 20 per cent of the tax revenue that went straight to the horse and greyhound racing codes, has not affected the income of the racing industry at all. And so while the bill is increasing our tax rate from 8 per cent to 10 per cent, the intention is to hand all of that extra revenue—every extra cent—to the Victorian racing industry because, as indicated in the second-reading speech, the government also intends to increase the payment to the racing industry from 1.5 per cent to 3.5 per cent of taxable net wagering revenue. That is that 2 per cent increase all gone right there. That means that 35 per cent of our point-of-consumption tax will simply be handed to the racing industry. The other 65 per cent goes to hospitals and health care. Just think what the hospital system could do with the extra revenue raised by this tax increase. Not wanting to labour the point, but the Royal Women’s Hospital is unable to cope right now with the volume of demand faced by its delivery suites. Babies are being born in the emergency department. They have shortened the duration of stay for women having caesarean sections all because they cannot cope with the demand.
This tax increase could have gone there instead. So this is a payout that seems to be mostly about helping the Victorian racing industry keep up with the New South Wales racing industry, and all the Greens are really wondering is why the racing industry needs this payout at all. From what I can see, when you have an industry that has just had a record year, with an annual turnover increasing to a record $7.1 billion, it seems to be doing just fine without any government handouts—and remember that this is an industry that profits from animal cruelty and gambling harm.
The Victorian Racing industry payment is split between our racing codes—Racing Victoria, Harness Racing Victoria and Greyhound Racing Victoria. In horseracing we still have multiple deaths each year, especially during our Spring Racing Carnival, including the death of Anthony Van Dyck at last year’s Melbourne Cup—that is Anthony Van Dyck the Irish racehorse, not the Flemish baroque painter. And in greyhound racing our state is pre-eminent, all right—it is number one in fact in deaths and injuries on the track.
I would also make the observation that the government’s sluggish response to this issue is typical of their lax attitude to gambling and racing regulation. I note the Treasurer’s comments in the second-reading speech about the economic and job creation importance of the Victorian racing industry, but I would remind those in this place that we have heard those lines before. These are the same lines we hear from this government about Crown Casino—arguments used to justify Crown keeping their licence and even despite repeated allegations of criminal conduct. That approach to Crown, where their bad behaviour was excused or ignored, has led us to the situation where they find themselves today, where Crown has been found unsuitable of holding a casino licence in New South Wales and we now have a royal commission into Crown’s suitability to hold one here. This week the Royal Commission into the Casino Operator and Licence began its public hearings, and we have already heard examples of what kind of behaviour Crown believe they can get away with here—refusing to hand over documents, and then large numbers of them late, and even threatening to call the Minister for Consumer Affairs, Gaming and Liquor Regulation on the auditors, who are just trying to do their jobs.
I make this comparison because the bill before us is dealing with similar subject matter—a lax approach to regulating the gambling industry and a gambling-fuelled industry that gets special treatment from this government. Last year when most industries closed their doors during the stage 4 lockdowns, horse and greyhound racing continued unabated. Apparently animal cruelty to facilitate online gambling was an essential service. We even saw the Minister for Racing, in a rush of blood, attempt to allow a gathering of 500 people at the Cox Plate, despite the fact that any other gathering was limited to five people. And we have seen more special treatment with the intention of this bill, which is to funnel even more money from this tax directly into the coffers of the racing industry. So this 2 per cent tax increase is really the bare minimum. While we support it, we will have more to say about this racing industry payment in the other place. Thank you.