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POINT OF CONSUMPTION TAXES -- WHO WINS, WHO LOSES? - Racing Talk - Racehorse TALK

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Offline Peter Mair

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O.P. « 2019-Jan-01, 08:31 PM »



POINT OF CONSUMPTION TAXES -- WHO WINS, WHO LOSES?

The following extracts from an SMH story today have the feel of a set-piece comment on the likely impact of point-of-consumption taxes on race-betting and other gambling turnover.

Many would be interested to know what professional stock-market analysts are saying about the implications for Tabcorp and more generally what responses the 'corporates' may be planning to avoid and evade such imposts on their operations.


[The new tax] will help ensure a well-regulated and sustainable wagering sector.’

Tabcorp spokesman



Online taxes to squeeze foreign bookmakers


Online betting revenue will now be taxed at the point-of-consumption.

A series of new digital betting taxes set to crimp the profits of online bookmakers in Australia is expected to force an acceleration of the wave of consolidation sweeping the fiercely competitive online gambling sector.

Online bookmakers are bracing for the so-called “point-of-consumption” taxes beginning in NSW, Victoria, Western Australia and the Australian Capital Territory today, which, for the first time, will tax digital gambling losses based on where a bet is placed rather than where the bookmaker holds its licence.

The new taxes, already operational in South Australia and Queensland, come in response to long-held concerns of state governments, TAB operator Tabcorp and the pubs lobby that the nation’s largely foreign-owned online gambling services – including Sportsbet, BetEasy, Ladbrokes and Bet365 – have not been contributing their “fair share”.

The new taxes were needed to level the playing field, they argued, as most of Australia’s online bookmakers held licences in the lowertax Northern Territory despite operating nationally, meaning they paid vastly less tax than state TABs.

“Tabcorp has supported the introduction of point-ofconsumption taxes and has worked with governments and the racing industry to ensure that the significant fees and taxes we already pay under our state licences are recognised,” a Tabcorp spokesman said yesterday. “The introduction and commencement of point-ofconsumption tax regimes will help ensure a well-regulated and sustainable wagering sector.”



Online Bubbasmith

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« 2019-Jan-02, 07:17 AM Reply #1 »
Who Wins .....Certainly not punters

Online Jeunes

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« 2019-Jan-02, 09:38 AM Reply #2 »
Does this apply to sports betting too or just racing?

Offline Antitab#

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« 2019-Jan-02, 10:40 AM Reply #3 »
Everything

Racing, Sports, Politics , Entertainment etc and yes like all taxes it is the consumer who will pay.

Online Bubbasmith

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« 2019-Jan-02, 11:04 AM Reply #4 »
How can Tabcorp justify a PoC tax on some punter who wants to back Nicole Kidman to win an Oscar or Malcolm Turnbull wanting to back the ALP to win the upcoming federal election ?

That punter might be an avid moviegoer and never been a horse racing punter or Malcolm Turnbull wanting to pick up a few easy dollars yet, Tabcorp suggests, "The introduction and commencement of point-of-consumption tax regimes will help ensure a well-regulated and sustainable wagering sector.”

Governments, under pressure from guess who, attempting to salvage a sinking ship.
« Last Edit: 2019-Jan-02, 02:31 PM by Bubbasmith »

Online arthur

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« 2019-Jan-02, 11:55 AM Reply #5 »
How can Tabcorp justify a PoC tax on some punter who wants to back Nicole Kidman to win an Oscar or Malcolm Turnbull wanting to back the ALP to win the upcoming federal election ?

Do yourself a favour and read the old short-story "Pigs is Pigs" . . I remember it from my school days . . You might get a smile 




The only group (and a very small group it is) who will reap some small benefit from PoC, are the on-course bookies at country TAB meetings who will be a little better able to compete with the corps

But 5 or 6% of the pittance that they hold will still not save them from eventual oblivion

Online JWesleyHarding

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« 2019-Jan-02, 05:55 PM Reply #6 »
For Arthur


Online arthur

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« 2019-Jan-02, 06:44 PM Reply #7 »
I liked the book better  :beer:
« Last Edit: 2019-Jan-02, 06:49 PM by arthur »

Online JWesleyHarding

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« 2019-Jan-02, 08:25 PM Reply #8 »
I liked the book better  :beer:


Unfortunately I don't have one available.

I made do with what I had access to. :sad:

Offline Peter Mair

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« 2019-Jan-02, 09:25 PM Reply #9 »


No answer is no answer

............ surely some Tabcorp share analysts have some idea of better or worse.

Perhaps the plan is to merge SA and QLD racing into a more rational business model.

Online jfc

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« 2019-Jan-03, 04:27 AM Reply #10 »
The winners are those who "relocate" to the Cayman Islands or wherever.


Offline theJudge

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« 2019-Jan-03, 04:21 PM Reply #11 »
Do yourself a favour and read the old short-story "Pigs is Pigs" . . I remember it from my school days . . You might get a smile 




The only group (and a very small group it is) who will reap some small benefit from PoC, are the on-course bookies at country TAB meetings who will be a little better able to compete with the corps

But 5 or 6% of the pittance that they hold will still not save them from eventual oblivion
Idea is for the states to get tax revenue, rather than currently the NT where the corporates are licenced

Sent from my ONEPLUS A5000 using Racehorse Talk mobile app


Online Bubbasmith

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« 2019-Jan-03, 05:17 PM Reply #12 »
Idea is for the states to get tax revenue, rather than currently the NT where the corporates are licenced

Sent from my ONEPLUS A5000 using Racehorse Talk mobile app
Sure, but at punters’ expense, the corporates  will pass it on to punters

« Last Edit: 2019-Jan-03, 05:29 PM by Bubbasmith »

Online Jeunes

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« 2019-Jan-03, 05:33 PM Reply #13 »
Is it every bet or the losing ones only?

Offline sobig

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« 2019-Jan-03, 05:59 PM Reply #14 »
Is it every bet or the losing ones only?

It is on the profit not turnover

Online Jeunes

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« 2019-Jan-03, 06:22 PM Reply #15 »
Profit on company?
Or Losing bet if someone lost $5?
Or profit on the market I.e. Sydney race 1 was a $10k profit

Offline sobig

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« 2019-Jan-03, 06:49 PM Reply #16 »
Easiest explanation in fro NSW government

The NSW PoC tax will be payable by all Australian-based wagering operators on the net
wagering revenue derived from wagers, or on facilitated wagering activity, of residents of
NSW.

Net wagering revenue is generally defined as the sum of all bets, fees or commissions
less winnings paid out to all NSW resident customers.

Online arthur

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« 2019-Jan-03, 06:54 PM Reply #17 »
If a punter loses $5 . . he loses $5

If he wins $5 . . he wins $5 . . . No difference

PoCT is levied on ALL bookies' Gross Profits, payable to the state govt where that profit is generated . . But with a threshold which excludes smaller bookies

What Bubba is pointing out, is that the corps will recoup the tax liability by framing their markets at a higher 'over-round'

And what I was pointing out was that the small country bookies will find it a bit easier to match the corps prices . . obviously their costs to turnover ratio is way out of whack with that of the corps, and they are slowly bleeding to death . .

Of course the little blokes need to somehow get punters back to the track

Offline Peter Mair

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« 2019-Jan-03, 08:06 PM Reply #18 »


The actual incidence of POC taxes may be complex.


Presumably punters have no incentive initially to register with a false address to reduce taxes payable by residents in different states.

The incentive to manage the different 'residency-liability' to pay POC taxes then lies with betting operators but it is not obvious how they might manipulate members into having a a low-tax residence.

The key question is whether, across the states, punters will get the same dividends or will dividends vary to reflect the difference in POC tax-rates.

.... if so that may reopen the prospect of punters fudging their state of residence, including by operating on an account in the name of a friend.

[.......as well ......are POC taxes to be applied to bets into parimutuel pools with TABs]


Online Jeunes

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« 2019-Jan-03, 08:13 PM Reply #19 »
Thanks guys for the clarification.

So in some ways the NT government finally gets penalised for their tax haven to the corporates.

It might be less margin for the corporates but it also means that they have to be competitive in the long run otherwise punters will go back to paramutual betting. A national pool will also help competitive betting as corporates have to beat it with fixed odds rather than mid tote and low fixed odds as they do most days.

Offline Peter Mair

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« 2019-Jan-03, 08:37 PM Reply #20 »


How is the NT government penalized by POC taxes?

If the NT government does not tax the corporates now , what do they lose?

Why would punters go back to parimutuel betting -- the very TAB pools of mug-money plundered by insiders and syndicates taking rebates.

The only hope for most punters is 'fixed odds' bets placed when the overall 'take' in the SP market is honed into less than 10%.

...... and the option is open for corporates to impose 'deductions' from dividends paid to customers in ststes with high POC taxes.



Online Jeunes

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« 2019-Jan-03, 09:38 PM Reply #21 »
PM, ask yourself this question, do you think every corporate will cannibalise the odds etc.

People shop around in real life for all products. It will be the same and in a few years, the only ones left will be the ones who offer the good odds.

The big loss for the corporates is the fact if the odds are crap, people will bet with the tab so all the adverts etc will be in waste and will be a spiral to oblivion. This is why most won’t make crap odds. It will just be a reduced profit.

NT government will also know some corporates will walk away in the long term so they will be losing licensing revenue. The interesting part will be if some corporates make sweetheart deals with different states.

Online fours

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« 2019-Jan-03, 11:39 PM Reply #22 »
Hmmm,

In the past at least 1 bookie has written out fake 500/1 tickets on short favs to transfer liabilities giving the bookie a net benefit somewhere. Even if its only a bad debt being reduced to nil so the tax man gives back some of the debt instead.

This sort of thing may re emerge.

Fours

Offline Peter Mair

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« 2019-Jan-04, 08:20 AM Reply #23 »


The idea that 'corporates' are competitive is not sound.

It is rare for a corporate to offer better odds than TABs in the pre-post market.

The sensible strategy for corporates is to offer marginally better odds than the TAB -- and that guarantees them a profit, given that the TABs are paying 16% and constraining the fixed-odds odds to cover that.

A tacit agreement among corporates to do this is sensible and a no-brainer.

Now that the corporates have driven out the old-style  bookmakers it is a nonsense that their presence is still tolerated -- especially when they can close customer accounts at will.


Offline Beachy

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« 2019-Jan-04, 11:16 AM Reply #24 »


It is rare for a corporate to offer better odds than TABs in the pre-post market.



You obviously don't look at many pre-post markets. Either that or you don't understand market percentages. Either way that's amazingly dumb statement.

I've looked at every race at Caulfield tomorrow for example, and the TAB are offering the worst percentage on so many races it's not funny. Which is staggering for a business of their size.


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