‘Blindsided’ – Wagering body slams NT tax hike

The Northern Territory’s move to double the tax cap on wagering companies has blindsided the corporate bookmaking sector.

The move, announced in Tuesday’s Northern Territory budget by treasurer Bill Yan, will see projected revenue from the Territory’s bookmaker tax jump from $19.8 million in 2024/25 to $32.6 million in 2025/26.

It will involve a change to the Racing and Wagering Act 2024 and will impact all 26 wagering companies registered in the NT, including Sportsbet, Ladbrokes/Neds, PointsBet, betr and bet365.

However, it is expected to have a greater impact on smaller operators.

The Straight understands that there had been no consultation over the increase, with WSPs only given days’ notice, with no right of reply, that the measure would be part of the budget.   

The industry lobby group, Responsible Wagering Australia (RWA) has expressed its serious concerns, saying the move is economically reckless and “risks undermining the Territory’s reputation as a stable and competitive licensing jurisdiction”.

RWA says there was no consultation over the move which comes ahead of the outcome of the Northern Territory government’s own Racing Industry Review.

“RWA have participated meaningfully in the review and eagerly anticipated a new strategic vision for racing in the Territory. This decision, made before the Review has had a chance to lay that strategic vision, has blindsided WSPs and materially undermines any outcome of the Review,” Responsible Wagering Australia CEO Kai Cantwell said in a statement.

“RWA members have proudly supported the Territory for years, investing in people, infrastructure, and long-term economic growth.”

RWA feels the move, which will impact all of its members, is counterproductive to the wagering industry in the Territory.

“RWA members are all licensed in the Northern Territory, directly employing around 600 Territorians in high-skilled roles across technology, customer service, and compliance – a figure that rises to over 1000 when including all wagering service providers licensed in the Territory,” Cantwell said.

The NT’s low taxation environment has made it the home of corporate wagering in Australia. All of the major players, with the exception of Tabcorp, are registered there.

Since coming to power in August last year, the Country Liberal Party of chief minister Lia Finocchiaro has made hints that it felt that the corporate bookmaking sector could contribute more to the NT’s economy.  

According to RWA, the wagering industry contributes more than $150 million to the Northern Territory economy, including $47.7 million in taxes and levies, $2.5 million in product fees to the NT racing industry and $46 million in wages paid to local staff

“The NT Government was elected on a platform of driving economic growth, delivering a competitive tax and investment environment and attracting private investment, with Chief Minister Lia Finocchiaro stating the Territory is ‘open for business’ and passing legislation to ‘strengthen our ability to deliver economic growth and attract investment’ – yet this policy decision directly contradicts that commitment and risks undermining investor confidence in the Territory,” Cantwell said. 

The Northern Territory Racing Review was announced in January this year, with a $110,000 contract to conduct the review to consultancy firm AP2 Advisory.

Racing Minister Marie-Clare Boothby said at the time that the review was to ensure the industry had a “strong and sustainable future” and to “maximise the economic and lifestyle contributions of the industry”.

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The StraightBren O’Brien

RWA questioned how the tax cap can be doubled when the government’s ongoing Racing Industry Review has yet to be released. 

“This tax hike pre-empts the outcome of the Review, a process that was meant to guide long-term, evidence-based and sensible reform,” Cantwell said. 

“It sends a message that consultation, process and industry sustainability have taken a back seat to short-term revenue grabs.

“A financially sustainable and well-regulated racing and wagering industry is critical to ensuring its long-term viability and the significant economic and employment benefits it delivers to Territorians.” 

Cantwell said the NT government should be working with industry to identify growth opportunities that will ensure the Territory’s continued leadership as a licensing jurisdiction.

“We are calling on the treasurer and chief minister to reconsider this decision and to engage in genuine consultation with the industry before moving forward,” he said.