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Australian Racing Body Aims To Stop Punters Migrating Offshore

by Mary Swire, Tax-News.com, Hong Kong

19 August 2014


A new trial program announced by governing body Racing Victoria aims to prevent "High Volume, Low Margin (HVLM)" punters from moving their betting activity to unlicensed offshore operators who avoid paying Australian state taxes and goods and services tax (GST).

The program will be trialled for licensed and approved Wagering Service Providers (WSPs), and will run for six months, backdated to July 1, 2014. HVLM punters are those with turnover on Victorian thoroughbred racing of nearly AUD500,000 (USD465,845) per annum and a margin to WSPs of less than 4 percent.

According to Racing Victoria, unlicensed offshore operators have a cost advantage relative to approved domestic WSPs. There is currently no legislation in force to stop Australian punters from moving their betting activity to these operators.

Under the scheme, qualified WSPs will be offered an incentive of up to 1 percent of turnover with approved HVLM clients, subject to conditions relating to overall race fields' performance, audit and transparency protections. Racing Victoria hopes that WSPs will be able to grow this segment of the market and deter punters from illegally betting offshore.

Racing Victoria's initiative came as New South Wales (NSW) Premier Mike Baird announced that his Government was working with Racing NSW on the possible harmonization of the state wagering tax with Victoria and Queensland. A recent report by Deloitte Access Economics claimed that achieving parity would enable the NSW thoroughbred racing industry to contribute a further AUD172m to the state economy.

TAGS: compliance | tax | tax compliance | tax avoidance | tax incentives | gambling tax | goods and services tax (GST) | audit | Australia | offshore | gambling | legislation | services | Providers

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