Monday 11. April, 2016

Welfare Groups Propose Online Gambling Tax Reform

A welfare group in South Australia is calling on the government to change gambling laws to ensure that taxes are paid where the bets are placed, in order to prevent certain areas of Australia becoming “virtual tax havens” for gamblers.

The South Australian Council of Social Services has argued that the Northern Territory and Norfolk Island are being used by gambling companies as a way to legally avoid having to pay taxes through the current law that requires companies to pay taxes where they are licensed and not where the bets are placed.

“When a gambling corporation does not have to be incorporated or resident in a jurisdiction, but can still use the license of a jurisdiction like Norfolk Island to lessen their taxes, I think we have gone beyond real business and are talking about virtual tax havens and [legal] tax avoidance,” stated Ross Womersley, chief executive of the South Australian Council of Social Services.

“Because of the way the license arrangements are made, South Australia is missing out on a whole lot of tax income.”

Gambling taxation provides significant income for local governments which can then use the income to improve community services, infrastructure and more. This income is also used to counter some of the problems that occur due to problem gambling and Mr Womersley argued that this is another reason why gambling should be taxed where it occurs and not in the jurisdiction where the company is licensed. He is calling for a national agreement on this issue.

“Given that the gambling industry generates a high level of problems, major issues in our community, we think that it’s absolutely important that the industry meets its social responsibilities in the form of taxation,” he said.

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