Added: June 4, 2015
Pay up and pay up right now! That would seem to be the new message coming from South Australia. Following is what this is all about. As you might already know, existing land based casinos and gambling operators, clubs and even pubs pay significant amounts of gambling taxes.
As far as online gambling operators go? No, not so much. According to the current laws on the books, online gambling operators that are based offshore pay a AU$1,500 fee. This fee allows these operators to legally offer their services to local residents. Yet, that’s where it stops. Besides this operating fee, these online gambling operators pay nothing else back to the local governments.
Contrast that with the AU$390 million in taxes collected annually from local land based gambling operators. Can you see the problem here? Yes, if you want to put it in gambling terms, you could certainly make the case that this is a clear case of a “stacked deck”. In other words, land based gambling operators are at an unfair disadvantage since they must pay gambling taxes yet their offshore competitors do not.
Enough is enough. New regulations are being set up to reverse that situation. According to Treasurer Tom Koutsantoinis, “it is important that online gambling operators pay taxes, considering that they are generating profits based on betting activity of South Australians”.
It turns out that there are close to 74,000 South Australians who have an online gambling account through 19 interstate betting operations. Yet as of now, none of those 19 companies pay any sort of gambling taxes at all.
Get this: this is no small amount of money being discussed here. According to top tier accounting firm estimates, once fully implemented and applied, the new regulations will end up sending an incredible AU$47 Million straight to government coffers. Talk about a tax windfall.
Better still, at least in terms of state coffers, that number, the AU$47 Million will continue to flow in and possibly much more over the next decade or so. As a matter of fact, the same accountancy firm mentioned above constructed a model to demonstrate to government officials how the tax dollars will show up. This model clearly shows that over the next decade, this new tax is worth an astounding AU$4.7 billion. Yes, that is billion with a big ‘B’. No wonder South Australian revenue gathering officials are so excited.
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