31 Aug 2023

Nicola Willis backs online gambling tax numbers 'estimates of the black market are good'

5:36 pm on 31 August 2023
Nicola Willis

Photo: RNZ / Samuel Rillstone

National has defended the costings for its online gambling tax, saying it is more than GST and includes corporate taxes and casino fees.

Labour's Kieran McAnulty and Barbara Edmonds argue the policy would require a four-fold increase in online gambling. National's Nicola Willis says the black market is bigger than they are assuming.

The proposed online gambling tax would be set up by requiring online casino operators to register and report their earnings, with services that did not comply affected by IP geoblocking. It was expected to net about $179 million every year.

Edmonds on Thursday told reporters at Parliament offshore online gambling operations were already subject to GST after a change brought in by National in 2016, and far more gamblers would be needed to cover National's expected costs.

"Based on the estimates I've seen we believe that New Zealanders lose $350m offshore due to online gambling, that's based on the GST count that we're getting," she said.

Her colleague Kieran McAnulty said the $350m figure was backed up by figures produces by the TAB and Lotto as part of the review of the Gambling Act.

"The TAB has been producing figures to demonstrate why there needs to be regulation of online gambling, Lotto have done the same. If they believed there was four times the amount of people gambling overseas they'd say so because it would strengthen their case.

"I can't see how the DIA, the TAB, Lotto have got figures that are a quarter of what the National party would need for this to add up."

Labour MP Kieren McAnulty

Kieran McAnulty Photo: RNZ / Angus Dreaver

"When you consider the amount that they're proposing to give to families, when those families would be required to gamble over half of that money to make this add up - that's not a little bit askew, that's a massive hole."

They challenged National to front up with their assumptions underlying the estimate.

"It's easy to prove - if they do, just show us your assumptions. They don't add up. They'd require four time the number of Kiwis to gamble overseas," McAnulty said.

Willis said the pair were assuming all the tax generated would come via GST, but corporate taxes would cover a bigger percentage than the GST portion would.

"We are going after corporate tax and casino duties too. That pumps up the numbers in a big way," she said.

She disputed the size of the black market of offshore online gambling operators, too.

"What they are assuming is that the current market they're collecting GST from rightly depicts the full market. It does not. The problem here is an enormous black market of online casino gambling. I don't like it but I'm going to regulate it and I'm going to tax the heck out of it.

"It's a very fast growing part of the market with people forecasting that over the next few years it will grow faster than other parts of our gambling market.

"What we know is that there is a large market right now of non-licenced, non-registered casinos who aren't paying GST but who also aren't paying corporate tax, aren't paying casino levies. That's research that marketers have done, they've looked at it, we know that it's been the case around the world."

She would not provide National's full background costings, however.

"These are people who are specialists in gambling, they've gone and had a look at the information that's out there and we're confident that their estimates of the black market are good.

"I'm prepared to give you a bit of a step through but I'm not going to release excel spreadsheets and be publishing all of that ... I don't think that's useful, nor do I think that you've had spreadsheets from Labour on their GST policy."

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