The Weatherill Government’s July Budget contained a new “place of consumption” tax to be levied from July 1 next year on the “net wagering revenue” of betting companies offering services in SA, such that any bets placed locally with Australian-based betting companies will be subject to an impost set to reap around $9 million a year.
Irish-owned Sportsbet last week ramped up its campaign against the tax, saying it had abandoned plans to build a $20 million data hub in Adelaide and terminating its ongoing sponsorship of the Gawler Racecourse, opting instead to spend its marketing dollars in rural Victoria.
Licensed in the Northern Territory, Sportsbet has been owned by Irish bookmaker Paddy Power since 2010.
But fellow bookmaker Ubet, formerly the SA TAB, has lashed the move, with the company’s SA general manager Tony Flanegan describing Tom Koutsantonis’s tax grab as “a fair and reasonable tax on wagering profits”.
“It is disappointing that a foreign-owned corporate bookmaker like Sportsbet thinks it is acceptable to use these community clubs — which are largely run by volunteers — as political playthings in their vindictive battle against the State Government over their objections to having to pay what on the surface appears to be a fair and equitable tax on wagering profits,” Flanegan said in a statement.
“South Australians are not mugs and should be rightly sceptical of the claims made by Sportsbet that any new regime in South Australia would do irreparable damage to their business.”
Ubet’s intervention in the debate is a welcome one for the Government, which can now point to a divided front among those companies to be targeted by the tax.
Ubet said it would “open discussions” with Thoroughbred Racing SA on behalf of the Gawler and Barossa Jockey Club “to make arrangements to step in and provide the club with financial support” after Sportsbet’s exit.
The company appears to be taking a very different PR tack with the new tax, arguing that “rather than fighting a requirement to make a contribution back to the state and the industry, Ubet is proud to have contributed well over $270 million back into the SA community in wagering taxes and racing industry product fees between 2011 and 2015”.
“As a long-term responsible operator who supports the racing industry and SA economy more broadly, we know that paying our fair share is a key component of maintaining our social licence to operate in the state,” Flanegan said.
Acting Treasurer John Rau today welcomed the prospect of Ubet’s intervention maintaining financial support for the Gawler and Barossa Jockey Club.
“It was disappointing that Sportsbet made this decision that has the potential to negatively impact the community of Gawler,” he told InDaily in a statement.
“We intend to proceed with the proposed place of consumption tax because we believe that if betting companies are making profits from South Australian punters they should be paying tax in South Australia, like other South Australian companies do – not in whichever jurisdiction their head office and servers happen to be located.”
Local News Matters
Media diversity is under threat in Australia – nowhere more so than in South Australia. The state needs more than one voice to guide it forward and you can help with a donation of any size to InDaily. Your contribution goes directly to helping our journalists uncover the facts. Please click below to contribute to InDaily.