Legislative Assembly for the ACT: 2003 Week 7 Hansard (26 June) . . Page.. 2552 ..
Wales. So the transactions that are subject to this taxing policy will be treated more favourably in the ACT than they are in New South Wales.
But I pose the question: why don't we do what Victoria and Tasmania have done in this area of taxing policy-that is, abolish this type of duty? I am not sure of the arguments that were used by those governments to abolish the duty. However, the quantum of revenue that it is estimated will be raised by this proposed policy is only around $1 million a year-a significant amount of money on its own but not perhaps a significant amount of revenue in the total budget. Nevertheless, on balance, this measure probably appears to be reasonable, although the government, through the Treasurer, could have provided additional information to support the proposal.
The second measure is the gaming machine taxation revenue raising initiative. This proposal aims to increase the highest rate of tax from 25 per cent to 27 per cent and, as such, it should apply only to the largest and most profitable clubs. I guess, at first sight, this proposal seems reasonable in that those organisations with a greater capacity to pay tax can do so. But, at the same time, there are two significant difficulties that we have with this proposal. The first difficulty is the apparent assumption that organisations with a gaming machine turnover of more than $50,000 a month are more profitable. This is an assumption and we do not have any detail from the government to support or disprove it.
Mr Speaker, it may be the case, for example, that some organisations that generate relatively high levels of gaming machine revenue are not particularly profitable at all, for a number of factors. They may have a high level of debt; they may have high capital spending commitments due to expansion and refurbishment activities. There may be other influences on their operations. And, again, the government has not provided any detail on the likely differential impact of this measure on clubs in the ACT.
The second difficulty with this proposal is the impact it will have on revenue flows within and from the affected clubs. Our clubs make a significant contribution to the community in so many ways. They are substantial employers, they generate income within regions across the city; they use a wide range of goods and services with the appropriate flow-on effects; they provide an enormous variety of services and activities; and they make grants to community organisations and other activities. We do not accept that the government should make this community focus even harder by taxing clubs at an even higher rate. We do not think this taxing proposal is a good idea, so I will be moving the amendment that has been circulated.
Mr Speaker, there is a third point, and it is something I would like members to consider before we move ahead to becoming, I think, more addicted to gambling revenues as a government. Several governments across this country are so addicted to gambling revenues to balance their budgets that were there to be significant changes in the way they tax gambling, in particular poker machines, their budgets would be severely impacted.
I guess that one of the justifications for raising the threshold from 25 to 27 per cent is that the Productivity Commission has determined on a number of occasions that the ACT does not as a jurisdiction maximise its potential on gambling taxation. I think we should be pretty proud of that. I think we should be fairly proud of the fact that we have not become so addicted to gambling legislation that we are drawn into the trap of sucking