Sportsbet chief Barni Evans warns revenue will continue to drop after Queensland government rejects recommendation to lower POC tax
Sportsbet boss Barni Evans has warned racing in Queensland will suffer after the government ignored a recommendation to lower the point of consumption tax.
Sportsbet chief Barni Evans and a peak wagering body have blasted the Queensland Government’s decision to defy a review recommendation to lower the point of consumption tax.
Queensland Racing Review architect Matt McGrath recommended a new funding model which would have seen the point of consumption tax (POCT) paid by corporate bookmakers reduced from 20 per cent to 15 per cent in Queensland.
But Racing Minister Tim Mander was not able to get it through Cabinet, meaning Queensland remains the most expensive state for bookmakers to operate in.
There are now fears several corporate bookmakers could turn the taps off Queensland and offer better products in other jurisdictions and greatly reduced offerings in the Sunshine State.
Some existing betting company sponsorships of race clubs in Queensland may also now be in jeopardy.
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Sportsbet is the major wagering force in Australia and its chief executive Barni Evans fired a shot across the bow of the State Government as he said Queensland could not compete with other racing states given the higher tax levels.
“Lowering the tax rate would unlock investments into Queensland racing, particularly regional clubs,” Evans told News Corp.
“These investments would have delivered long-term sustainability for racing.
“The consequences will be felt most by the 120 regional and country race clubs, which were set to be the largest beneficiaries.
“These clubs will continue to rely on Government handouts rather than enjoying the benefits of a thriving, self-sustaining industry.
“The Government’s response to the review is disappointing.
“It does not address the long-term sustainable funding of the industry through tax reform.
“It represents a significant missed opportunity to reignite investment and secure the future of racing in Queensland.
“Over the past four years, Racing Queensland’s revenue has significantly trailed the growth in other states.
“The reason is clear: Queensland’s 20 per cent point of consumption Tax (POCT), the highest of the major states in the country, is driving investment south.
“The reality is Queensland cannot compete with NSW, Victoria and South Australia with the current tax framework.”
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Responsible Wagering Australia (RWA) – which represents bookmakers which make up 60 per cent of the market – fired off a press release headlined “Queensland Government Puts Racing Industry At Risk.”
“We know there is a tipping point where taxation becomes counter-productive as wagering service providers have to pull back on customer value with lower odds, and less investment,” RWA chief executive Kai Cantwell said.
“That reduces wagering activity, shrinks the tax base, and results in less money flowing to racing,” Cantwell said.
“While the review identified the need to reassess the point of consumption tax (POCT) settings, it is unclear why this recommendation was not progressed, and RWA believes with further discussion we could achieve a better long term result for the industry.
“Reducing the current 20 per cent POCT rate remains an important opportunity to strengthen industry funding, support growth and secure long term returns for racing.”
Mander told News Corp he was confident he and Racing Queensland boss Lachlan Murray could continue to work with corporate bookmakers to promote racing in Queensland.
“I’m confident the relationship is strong enough for us to be able to work through all this,” Mander, who pointed to a new $200m Racing Future Fund to help deliver modern racing infrastructure, said.
“There’s been no change (to POCT), we haven’t altered what the playing field has been for the last couple of years.
“The commitment of the Government is we are not going to touch taxation levels, in whatever industry, for this term of Government.”
Queensland remains the most expensive state for wagering operators to do business and a spokesman for Entain, parent company of Ladbrokes and Neds, said: “We will continue to work constructively with the Government to support a sustainable racing and wagering industry, including protecting Queenslanders from black-market operators who pay no tax and offer no consumer safeguards.”
Originally published as Sportsbet chief Barni Evans warns revenue will continue to drop after Queensland government rejects recommendation to lower POC tax
