MAJOR ANNOUNCEMENT - WAGERING TAX PARITY LEGISLATION INTRODUCED INTO THE NSW PARLIAMENT TODAY
Tax Parity with Victoria
Throughout the year Racing NSW continued to prosecute the case with the NSW Government for the introduction of parity with the Victorian Racing Industry in respect of the sharing of TAB wagering revenue between the Government and the industry.
Under existing arrangements, for every $100 bet on the TAB, on average $83 is distributed to the punter. The remaining $17 (TAB wagering revenue) is shared between the State Governments, Commonwealth Government, Racing Industry and totalizator operator (TAB). The NSW State Government takes $3.22, which is the highest share of any State Government in Australia. The Victorian Government only takes $1.28, with some State Governments (e.g. South Australia and Tasmania) now not taking any part of the wagering revenue.
The current inequity that exists between the share taken by the NSW Government as compared to the share taken by the Victorian Government has meant that the Victorian Racing Industry [three codes] receives $100 million more per annum than the NSW Racing Industry to fund prizemoney, racecourse improvements and other payments to participants.
Initially, in response to our representations, the NSW Government provided a grant of $10 million to enable Racing NSW to conduct the 2015 Championships series having already provided $10 million towards the 2014 series of The Championships.
Subsequently, the Deputy Premier and Minister for Racing, Troy Grant MP announced that the Government had resolved to reduce the tax on wagering to bring it in line with the tax imposed on wagering in Victoria (Tax Parity) and that it would be phased in over a 5 year period and would form part of the annual NSW budgetary process.
During this entire process the Deputy Premier has been a vigorous advocate for NSW to achieve parity with Victoria.
However, Racing NSW was concerned that under the proposed structure the funding would become a year-by-year proposition subject to the economic circumstances and political vagaries which may exist from time to time. In addition, we were concerned that the arrangements would only relate to the commitment of funding for a five year period, with no guarantee that it would continue thereafter.
Following these announcements Racing NSW liaised with the Minister and his staff with a view to having the new arrangements brought forward by 6 months, thus providing the Industry with $19.3 million in this financial year. In addition we submitted that the arrangements should be implemented by way of legislation thereby giving the Industry more certainty over its finances.
Following Racing NSW’s submissions, the Minister advised on 10 July 2015 that the tax reductions and associated rebates to the industry would be brought forward and would be implemented by way of legislation which would be introduced in the November session of Parliament. This provides the NSW Thoroughbred Racing Industry with certainty over its future revenue streams.
The approximate payments to the NSW Thoroughbred Racing Industry are as follows:
Financial Year NSW Thoroughbred Share of Tax Parity
The benefit of the reductions in wagering tax [approx. $70 million per annum when full parity is achieved] will flow directly to the NSW Thoroughbred Racing Industry, enabling Racing NSW to implement its Strategic Plan over the next five years. The Racing NSW Strategic Plan can be found on the following link:
Racing NSW wishes to place on record its immense appreciation to the Premier the Hon. Mike Baird MP and the Deputy Premier and Minister for Racing the Hon Troy Grant MP for making parity a reality and ensuring a prosperous future for the NSW Thoroughbred Racing Industry and its 50,000 participants.