Tax Rates Rise For Victorian Betting Sites?
Online betting sites being operated in Victoria may be set for a tax rate rise. Proposed legislation under the Victorian government led by the VIC Premier Daniel Andrews.
Proposed Adjustments Of Rates
This Monday it was announced the POCT will rise by around 5% from the start of July the 24th 2024. This would take the POCT tax rate in Victoria from 10% to 15% which is in line with most of the other states in Australia including South Australia, Western Australia, and Tasmania.
Why Is Victoria Changing Its Rates?
In 2019 Victoria implemented its POCT tax policy. It was created out of fear that internationally owned online gambling companies were being licensed in Victoria to avoid paying higher taxes if licensed in other states in Australia.
Victoria originally had its POCT tariff set at 8% till last year when they adjusted it to 10%. The POCT rate is now set to go even higher.
What Is The POCT?
Simply put the POCT tax (point of consumption tax) is a newly designed tax law. This has been designed to have tax payable at the point in which state the bet was placed. Bets placed in Victoria generate revenue for the Victorian tax office etc.
In Australia South Australia has had the highest POCT rate at 15%. Victoria had the lowest at 8% and New South Wales has been adjusted in late 2022 to 15%.
Where Will The Extra Revenue From This Tax Go?
The extra revenue from this tax will go towards funding and helping create jobs in the racing and gambling industry.
It has been announced that half of the revenue will go back into racing.
The racing commissioner Anthony Carbine supports the changes and announced:
“These changes provide vital long-term certainty for the industry and ensure that it continues to be funded from wagering generated on its product – helping the industry to back jobs and events that bring in millions of dollars each year to communities right across the state.”
A Call Out For A National POCT Rate To Be Set
The larger sportsbook companies like Neds, Sportbet, and Ladbrokes hold a license in the lower paying State of the Northern Territory. This means the larger portion of their profit will go overseas and not benefit Australia. The exact reason the POCT tax has been put in place for.
Tim Costello the head of Alliance for Gambling supports the move but is calling for consistency across all states. With a national set standard on the POCT tax rate.
The Greens political party has been calling for the rate to be increased to 20% in Victoria. The extra funding reportedly would be helpful for racing Victoria however, an increase to 20% may be years away from becoming a reality.