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Legislative Assembly for the ACT: 2000 Week 11 Hansard (30 November) . . Page.. 3494 ..

MS TUCKER (continuing):

At a briefing we were given the government explained that they are seeking to attract the large players, that the larger companies should be attracted because they will somehow be better equipped to meet the regulations to ensure consumer protection and so on. This is an interesting statement. On one hand, we are told that there is now an accreditation system in place through the gambling commission with instructions to applicants, on-going monitoring et cetera, and that this system will ensure that only best practice providers will be allowed into the industry. Yet, on the other hand, it appears that the government is not all that confident about that quality assurance if they believe that a higher tax rate will discourage smaller providers or providers with a lower profit margin. I am concerned about that because one would have thought that with a good accreditation process in place such concessions would not be necessary.

One wonders what guarantee there is that the five per cent tax group-those with the largest profit-will provide better consumer protection mechanisms if this lower tax rate is applied. There is an assumption that providers who make the highest profits and pay the very low tax rate will be able to provide better consumer protection mechanisms. That seems to be a very sloppy kind of approach.

It is interesting to look at the tax rates across country for various forms of gambling. Governments receive 82 per cent for lottos and lotteries, 34 per cent for wagering, 30 per cent for gaming machines and 21 per cent for gambling at casinos. These figures include taxes, licence fees and other charges, so they are not directly comparable with the figures for the territory.

In the ACT the government sets different tax rates as well. The casino has a 20 per cent rate on profits from general gambling with a 10 per cent rate on commission-based profits relating to high rollers. In the case of poker machines, there is no tax up to $8,000, a 23.5 per cent tax for $8,000 to $24,000, 24.5 per cent for $25,000 to $50,000 and 25 per cent for amounts greater than $50,000. So the scale is the reverse when you are looking at poker machines. It just makes you wonder why there is not a consistent rationale in place for determining not only how a sliding scale works but also how decisions about taxation are made by governments.

The drop in the taxation rate in the regulation that is now before us is obviously a result of the government's need to compete with the other states and territories. They have made that quite clear. This arrangement does not even seem to make sense economically in view of the Productivity Commission analysis of the opportunity costs of gambling to the local economy. If we have a good look at the economics of introducing these further forms of gambling and the impact they have on the general economy of the community we find that there is nothing rational about supporting this sort of activity.

Of course, one of the arguments that are put is: "Don't worry because the opportunity costs that are lost through expenditure on gambling will not actually be occurring here because most of the players will not be living in the ACT." So apparently it is okay for a government to shift social harm; if the social harm is shifted then the government does not have an ethical responsibility to take responsibility for that. Because somehow it is not going to impact so much on their own citizens, they are not interested in the broader ethical question of the community bearing the cost of that social burden.

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