The NSW Government confirmed in its June 19, 2018 Budget announcement that a 10% tax would be applied to the net revenue earnings of corporate bookmakers as from January 1, 2019. It also confirmed that 20% of the total revenue generated from the tax would be distributed to the three codes of racing.
Unfortunately, and despite ongoing requests from the NSW GBOTA for confirmation, the NSW Government has chosen not to confirm publicly how it intends to split the industry distribution between the codes.
Treasurer Dominic Perrottet, however, when pushed in an interview with Ray Hadley on 2GB on Wednesday, June 20, gave every indication that he and the Coalition Government was predisposed to just 13% of the POCT racing codes’ distribution going to greyhounds. The completely flawed logic for the NSW Government to even consider this unfair percentage is that it applies to TAB wagering revenue under the Racing Distribution Agreement.
But the distribution formula for TAB turnover has nothing to do with the operations of corporate bookmakers. Any revenue generated for the Government from POCT will be generated on a market share basis. If a portion of that revenue is to then be distributed to the racing codes, then also allocating it on the basis of market share is the only fair and rational approach.
Up to $40m per year is expected to be distributed to the racing codes as a result of POCT and the funding difference between 13% and our current market share (22%) is in excess of $3.5m per year, every year and could be even more, subject to growth.
The Berejiklian-Barilaro Liberal National Coalition Government knows that the only fair approach is for the industry POCT distribution to be applied on a market share basis.
From the Premier down, the current NSW Government has in the past committed to giving the greyhound industry a ‘fair go’ on funding… now is the time for the NSW Government’s actions to mirror its words and for the NSW Government to show good faith.
We, of course, remember and are still hurt by the Government’s incredibly unfair decision in 2015 to provide only 10% of taxation harmonisation revenues to the greyhound racing industry, despite greyhound racing deserving a fair return based on market share.
When the current NSW Government repealed the Greyhound Prohibition Act 2016 last year, it went to considerable lengths to communicate a positive future based on a ‘partnership’.
As greyhound racing participants, in positively embracing change, we are living up to our end of the partnership. For the NSW Government, the percentages applied to three code split of POCT distributions is, quite simply, a test of its commitment to the same partnership.
NSW GBOTA accepts and welcomes the seed funding provided to assist with regulatory establishment costs and a race safety fund – these are positive contributions from the NSW Government. But POCT is about ongoing annual funding and the NSW Government must deal with the issue fairly, given its critical connection to improving prospects of financial sustainability for the greyhound industry.
SO WHAT CAN PARTICIPANTS DO?
The NSW Government has been regularly and fully briefed on the POCT industry distribution matter and the expectations of the greyhound code. Despite this, it appears to strongly not support a fair split. As such, the NSW Government can be expected to provide us participants and the industry with just 13% - instead of our rightful market share return of 22%.
The NSW Government needs to hear your feedback, it needs to hear clearly and directly that greyhound racing stakeholders’ will bitterly oppose and resent any unfair POCT funding split.
All greyhound racing stakeholders are requested to engage in person, by phone or by email with their local Member of Parliament, seeking the support of your local Member to raise the POCT industry distribution formula with the Treasurer, Dominic Perrotet. Your engagement with your local Member should take place immediately, if at all possible.
In all your communication, emails and conversations:
be strong, demand fairness, and be respectful
WHAT IS OUR CRITICAL MESSAGING FOR MEMBERS OF PARLIAMENT?
- Point of Consumption Tax (POCT) will apply to the wagering operations of corporate bookmakers.
- The NSW Government announced in this year’s Budget on July 19, 2018 that a POCT would be applied at a rate of 10% of net revenue from wagering operations. The Government also announced that 20% of the revenue generated would be distributed to the three codes of racing.
- The Treasurer Dominic Perrotet indicated in an interview with Ray Hadley on July 20, 2018 that the NSW Government was predisposed to distributing just 13% of the distribution provided to the racing codes to greyhound racing, despite greyhound racing generating 22% of the POCT revenue generated by the Government.
- Confirm with your Member of Parliament that greyhound racing is simply seeking a fair share of the POCT racing industry distribution. POCT revenue will be generated for the Government on the basis of market performance. Any portion re-distributed to the industry should be on the same market performance basis.
- Strongly request that your Member of Parliament represent your support for a market share formula to apply to POCT racing industry distributions to the NSW Treasurer, Dominic Perrottet.
- Encourage your Member of Parliament to fight for a fair go on POCT funding for the greyhound racing industry and to ask the NSW Treasurer for a fair decision - a funding split reflecting market performance.