Betting Tax Act 2001 (NSW)

Betting Tax Act 2001 No 43 An Act to provide for the imposition of tax on certain betting; to repeal the Bookmakers (Taxation) Act 1917 and the Racing Taxation (Betting Tax) Act 1952; and for other purposes. Part 1 Preliminary 1 Name of Act This Act is the Betting Tax Act 2001. 2 Commencement This Act commences on 1 July 2001. 3 Definitions In this Act— Chief Commissioner means the Chief Commissioner of State Revenue referred to in section 60 of the Taxation Administration Act 1996. exercise a function includes perform a duty. function includes a duty. meeting for greyhound racing means any meeting at which greyhound racing (that is, racing between greyhounds in competitive pursuit of a lure activated by mechanical means) is carried on. meeting for harness racing means any meeting at which harness racing is carried on. meeting for horse racing means any meeting (other than a meeting for harness racing) at which horse racing is carried on. race meeting means a meeting for horse racing, meeting for harness racing or meeting for greyhound racing. racecourse means any land that is used to hold or conduct a race meeting. racing club means a club, association or body of persons or body corporate formed for promoting or controlling horse racing, harness racing or greyhound racing, or for holding race meetings. totalizator has the same meaning as in section 6 of the Totalizator Act 1997. totalizator licensee means the holder of a licence under the Totalizator Act 1997. 4 (Repealed) 5 Relationship with Taxation Administration Act 1996 This Act is to be read together with the Taxation Administration Act 1996, which makes provision for the administration and enforcement of this Act and other taxation laws. 5A Extraterritorial operation of Act (1) It is the intention of the Parliament of New South Wales that the operation of this Act should, as far as possible, include operation in relation to the following— (a) things situated in or outside the territorial limits of the State, (b) acts, transactions and matters done, entered into or occurring in or outside the territorial limits of the State, (c) things, acts, transactions and matters (wherever situated, done, entered into or occurring) that would, apart from this Act, be governed or otherwise affected by the law of another State, a Territory, the Commonwealth or a foreign country. (2) Without limiting subsection (1), it is the intention of the Parliament of New South Wales that the provisions of this Act have an operation in relation to the things, acts, transactions and matters referred to in that subsection even if the rules of private international law (whether at general law or as provided by legislation) would require the application of a law other than this Act instead of the provisions of this Act. 5B Notes Notes included in this Act do not form part of this Act. Part 2 Imposition of betting tax 6, 7 (Repealed) 8 Betting tax on commission on totalizator betting (1) Betting tax is payable by a totalizator licensee on the commission deducted (under section 69 of the Totalizator Act 1997) from the total amount invested in each totalizator conducted by the licensee. (2) The tax payable is— (a) the relevant percentage of the total amount so deducted each day on which the totalizator licensee conducts a totalizator on one or more events or contingencies, or (b) any lower percentage of that amount that the Governor may declare, on the recommendation of the Minister, by order published in the Gazette. (2A) The relevant percentage is— (a) in respect of a totalizator conducted during the period commencing on 1 July 2015 and ending on 30 June 2016—16.2%, or (b) in respect of a totalizator conducted during the period commencing on 1 July 2016 and ending on 30 June 2018—13.5%, or (c) in respect of a totalizator conducted during the period commencing on 1 July 2018 and ending on 30 June 2019—12.17%, or (d) in respect of a totalizator conducted during the period commencing on 1 July 2019 and ending on 30 June 2020—10.7%, or (e) in respect of a totalizator conducted during the period commencing on 1 July 2020 and ending on 30 June 2022—7.6%, or (f) in respect of a totalizator conducted on or after 1 July 2022—3.49%. (3) The tax is payable by the totalizator licensee conducting the relevant totalizator. (4) The tax is payable within 7 days after the day in respect of which the tax is payable. (5) A tax is not payable under this section on any amount that is applied by the totalizator licensee in rounding up an amount calculated as dividend. 9 Betting tax on totalizator roundings (1) Betting tax is payable on totalizator roundings. (2) The tax payable is the relevant percentage of the total amount of roundings arising in respect of each day on which a totalizator is conducted by a totalizator licensee on one or more events or contingencies. (2A) The relevant percentage is— (a) in respect of a totalizator conducted during the period commencing on 1 July 2015 and ending on 30 June 2016—16.2%, or (b) in respect of a totalizator conducted during the period commencing on 1 July 2016 and ending on 30 June 2018—13.5%, or (c) in respect of a totalizator conducted during the period commencing on 1 July 2018 and ending on 30 June 2019—12.17%, or (d) in respect of a totalizator conducted during the period commencing on 1 July 2019 and ending on 30 June 2020—10.7%, or (e) in respect of a totalizator conducted during the period commencing on 1 July 2020 and ending on 30 June 2022—7.6%, or (f) in respect of a totalizator conducted on or after 1 July 2022—3.49%. (3) The tax is payable by the licensee. (4) The tax is payable within 7 days after the day in respect of which the roundings arose. (5) In this section— rounding means an amount that would ordinarily form part of a dividend but that is retained by a licensee as a result of the rounding down of an amount calculated as dividend. 10 Betting tax on approved betting activities (1) Betting tax is payable on net earnings in connection with the total amount of bets placed with a totalizator licensee in respect of an approved betting activity conducted by the licensee on each day on which such an activity is conducted. (2) The tax payable is the relevant percentage of the amount obtained by subtracting from the total amount of bets placed with the totalizator licensee in respect of an approved betting activity conducted by the licensee on a day the total amount payable as dividends or other returns to investors in respect of those bets. (2A) The relevant percentage is— (a) in respect of an approved betting activity (other than a computer simulated racing event betting activity) conducted— (i) during the period commencing on 1 July 2015 and ending on 30 June 2016—9.2%, or (ii) during the period commencing on 1 July 2016 and ending on 30 June 2018—7.43%, or (iii) during the period commencing on 1 July 2018 and ending on 30 June 2019—6.6%, or (iv) during the period commencing on 1 July 2019 and ending on 30 June 2020—5.8%, or (v) during the period commencing on 1 July 2020 and ending on 30 June 2022—4.38%, or (vi) on or after 1 July 2022—8.47%, or (b) in respect of a computer simulated racing event betting activity—15%. (3) The tax is payable by the totalizator licensee. (4) The tax is payable within 7 days after the day in respect of which the tax is payable. (4A) No betting tax is payable on net earnings in connection with the first $255 million of the total amount of computer simulated racing event bets placed with a totalizator licensee in any financial year. (4B) Subsection (4A) ceases to have effect at the end of 30 June 2034. (5) In this section— approved betting activity means a betting activity approved under section 13 of the Totalizator Act 1997 to be conducted by a totalizator licensee under that Act. computer simulated racing event bet means a bet in respect of a computer simulated racing event betting activity. computer simulated racing event betting activity means an approved betting activity conducted on a computer simulated horse racing, harness racing or greyhound racing event. financial year means a year ending on 30 June. Part 3 Offsets and rebates of betting tax 11 Offset of betting tax paid by totalizator licensee (1) (Repealed) (2) A totalizator licensee is entitled to an offset against the betting tax payable by the licensee under sections 8 and 10 of an amount equal to the sum of— (a) 15% of the excluded commission for the day concerned, and (b) 15% of the excluded net earnings for the day concerned. (3) If, in respect of any financial year, a totalizator licensee's excluded commissions for the financial year exceed the sum of the amounts of excluded commission for each day of the financial year, the Chief Commissioner is to pay to the totalizator licensee an amount equal to 15% of the difference. Note— Section 111 of the Taxation Administration Act 1996 provides that if the Chief Commissioner is authorised or required to pay an amount under any taxation law, the amount is to be paid from the Consolidated Fund which is appropriated to the necessary extent. (4) If, in respect of any financial year, a totalizator licensee's excluded net earnings for the financial year exceed the sum of the amounts of excluded net earnings for each day of the financial year, the Chief Commissioner is to pay to the totalizator licensee an amount equal to 15% of the difference. Note— Section 111 of the Taxation Administration Act 1996 provides that if the Chief Commissioner is authorised or required to pay an amount under any taxation law, the amount is to be paid from the Consolidated Fund which is appropriated to the necessary extent. (5) Nothing in this section requires a totalizator licensee to pay betting tax for any period before the offset under this section is applied to that liability. Note— Division 2 of Part 6 of the Taxation Administration Act 1996 enables the Chief Commissioner to approve special arrangements for the lodging of returns and payment of tax under taxation laws. (6) For the avoidance of doubt, the reference in section 70 (2) (a) of the Totalizator Act 1997 to a total amount of betting tax payable by TAB Limited under sections 8–10 of this Act in respect of a quarter does not include any offset under this section. (7) In this section— approved betting activity has the same meaning as in section 10. excluded commission, for a period, means the lesser of the following— (a) the total amount of commission deducted (under section 69 of the Totalizator Act 1997) from the amounts invested with the licensee in totalizators during the period concerned by investors who were not, at the time of the investment, located in NSW, (b) 5.5% of the total commission deducted (under section 69 of the Totalizator Act 1997) from the total amount invested with the licensee in totalizators during the period concerned by all investors. excluded net earnings, for a period, means the lesser of the following— (a) the total amount of net earnings from bets placed with the totalizator licensee by persons who were not, at the time the bet was placed, located in NSW in respect of approved betting activities conducted by the licensee during the period concerned, (b) 4% of the total amount of net earnings from all bets placed with the totalizator licensee in respect of approved betting activities conducted by the licensee during the period concerned. 12 Rebate of tax to racing clubs (1) The Minister may, by order published in the Gazette, give directions for the allowance of a rebate of the betting tax payable under Part 2 in relation to a race meeting by a licensee that is a racing club when the race meeting turnover in relation to a race meeting is less than— (a) an amount specified in the direction, or (b) an amount calculated in accordance with the provisions of the direction. (2) The total amount of betting tax required to be paid by a racing club in relation to a race meeting is reduced by the amount of any rebate to which the club is entitled under a direction under this section. (3) A direction under this section cannot make provision for the allowance of a rebate in respect of any betting tax payable on bets made with the racing club that section 17 of the Totalizator Act 1997 (Requirements for conduct of on-course totalizators by racing clubs) provides are to be received by the racing club as an agent for the TAB. (4) In this section— race meeting means a race meeting held by one racing club on one racecourse. race meeting turnover, in relation to a race meeting, means the amount calculated in accordance with the relevant direction of the Minister as race meeting turnover. Part 4 Point of consumption tax Division 1 Preliminary 13 Definitions In this Part— approved form means a form approved by the Chief Commissioner. bet includes the following— (a) any bet or wager on any event or contingency, including but not limited to events and contingencies relating to the outcomes of racing, sports, elections, current affairs and entertainment, (b) a free bet, (c) a lay-off bet, (d) any other similar agreement or arrangement prescribed by the regulations, but does not include any activity permitted under section 7 of the Unlawful Gambling Act 1998 or under a corresponding provision of a law of another State or a Territory or the Commonwealth. betting exchange and bookmaker have the same meanings as those terms have in the Betting and Racing Act 1998. betting operator means a licensed betting service provider within the meaning of the Betting and Racing Act 1998. Note— The Betting and Racing Act 1998 defines a licensed betting service provider to be a betting service provider (being a bookmaker, a person who operates a totalizator or a person who operates a betting exchange) that holds a licence or authority (however described) under the legislation of this or any other State or Territory to carry out its betting services (whether in that State or Territory, or elsewhere). free bet means a bet made wholly or partly without the person making the bet paying any monetary amount for the bet or part of the bet. Note— Examples of a free bet (also known as a bonus bet) include a bet made using the following— (a) a free component provided for making a bet, (b) an amount representing a bonus on a previous winning bet, (c) an amount representing a refund of all or part of the staked amount for a previous non-winning bet. lay-off bet means a bet made by a betting operator (the first betting operator) with another betting operator to reduce, wholly or partly, the liability of the first betting operator in relation to 1 or more bets made with the first betting operator. net NSW wagering revenue—see section 13A. point of consumption tax—see section 13C. totalizator derived odds means any odds derived from or contingent on totalizator odds but does not include totalizator odds. totalizator odds means any odds that are dependent on the result of the working of a totalizator on an event or contingency. 13A Meaning of "net NSW wagering revenue" (1) The net NSW wagering revenue of a betting operator, for a period, is the sum of the following— (a) for NSW bets made with the betting operator using a totalizator—the total of all NSW revenue from totalizator pools paid to the betting operator during the period, (b) for NSW bets made using a betting exchange operated by the betting operator—the total amount of all fees or commissions paid to the betting operator in relation to NSW betting exchange bets made with the betting operator during the period, (c) for NSW bets made with the betting operator (other than NSW bets made using a betting exchange or a totalizator)—the sum of the following during the period— (i) the total amount of all NSW bets (including, but not limited to, bets placed at fixed odds and at totalizator derived odds) made with the betting operator (including the face value of any free bets), (ii) the total of any fees or commission associated with making the bets, less the sum of the following— (iii) the total amount of winnings paid or payable in relation to those bets (including winnings paid in relation to free bets, but not including winnings paid in the form of a credit or entitlement that cannot be converted to money), (iv) the total amount of refund paid or payable in relation to those bets (other than amounts paid or payable in the form of a credit or entitlement that cannot be converted to money), (d) any amounts the betting operator became entitled to retain during the period on account of unclaimed winnings in relation to NSW bets, (e) any other amounts the betting operator became entitled to be paid during the period as consideration for, or in relation to, NSW bets made with the betting operator. Note— In calculating the net NSW wagering revenue of a betting operator— (a) lay-off bets accepted by the betting operator placed by a person (or another betting operator) located in NSW are included, and (b) lay-off bets that the betting operator places with a person (or another betting operator) are not included. (2) For the avoidance of doubt, for the purposes of this section, the same betting operator can operate a totalizator, operate a betting exchange and be a bookmaker. (3) In the section— NSW revenue, from a totalizator pool, for a betting operator during a period, means the amount calculated using the formula— where— Dividendstotal means the total amount of dividends paid or payable out of the totalizator pool to investors. Betstotal means the total amount of bets placed in the totalizator pool. BetsNSW means the total amount of NSW bets placed with the betting operator in the totalizator pool. totalizator pool means a pool of totalizator bets made on the outcome of an event or contingency. 13B Meaning of "NSW bet" (1) A reference in this Part to a NSW bet, or a NSW bet of a particular type, is a reference to a bet, or a bet of that type, made by a person who is located in NSW when the bet is made. (2) For the avoidance of doubt, a lay-off bet made by a betting operator who is located in NSW when it is made is a NSW bet, whether or not the liability the betting operator seeks to reduce by making the lay-off bet relates to NSW bets made with the betting operator. Division 2 Imposition of point of consumption tax 13C Liability to pay point of consumption tax (1) A betting operator is liable to pay tax on the operator's net NSW wagering revenue for a financial year (point of consumption tax). (2) Point of consumption tax is payable in respect of a financial year as follows— (a) if the net NSW wagering revenue for the financial year is $1,000,000 or less—no tax is payable, (b) if the net NSW wagering revenue for the financial year is more than $1,000,000—tax is payable at the rate of 15% of the amount by which the net NSW wagering revenue exceeds $1,000,000. 13D Tax to be paid monthly (1) A betting operator is liable to pay point of consumption tax for each month of the amount specified in this section. (2) For any month of a financial year before the qualifying month, if any, the amount is nil. (3) For the qualifying month of a financial year, the amount is 15% of the difference between— (a) the net NSW wagering revenue of the betting operator for the period starting on 1 July in the financial year and ending on the last day of the qualifying month, and (b) $1,000,000. (4) For any month of a financial year after the qualifying month, the amount is— (a) if the net NSW wagering revenue of the betting operator for the month is nil or a negative amount—nil, or (b) in any other case—15% of the net NSW wagering revenue of the betting operator for the month. (5) If point of consumption tax is payable in relation to a month, the tax is to be paid within 21 days after the end of that month. (6) In this section, qualifying month, in relation to a financial year, for a betting operator, means the first month of the financial year in which the net NSW wagering revenue of the betting operator for the period starting on 1 July in the financial year and ending on the last day of the month is more than $1,000,000. 13E Annual reconciliation A betting operator's point of consumption tax liability is to be recalculated after the end of the relevant financial year. Note— Section 18 of the Taxation Administration Act 1996 provides that if a taxpayer has paid a greater amount of tax in relation to a tax liability than the amount assessed for that liability, the Chief Commissioner must refund the difference to the taxpayer. Division 3 Registration 13F Requirement to apply for registration (1) This section applies to a betting operator if— (a) the betting operator is not already registered under this Division as a betting operator, and (b) for any month of a financial year, the net NSW wagering revenue of the betting operator for the period starting on 1 July in the financial year and ending on the last day of the month is equal to or more than $1,000,000. (2) The betting operator must, within 7 days after the end of the month, give the Chief Commissioner an application, in an approved form, for registration under this Division as a betting operator. Maximum penalty—100 penalty units. 13G Registration of betting operator (1) If a betting operator applies under this Division for registration as a betting operator, the Chief Commissioner must register the betting operator. (2) If a betting operator who is required to apply for registration under this Division does not apply for that registration, the Chief Commissioner may register the betting operator. 13H Notice of registration (1) The Chief Commissioner must, as soon as practicable after registering a betting operator under this Part, give the betting operator a notice stating— (a) that the betting operator has been registered as a betting operator under this Division, and (b) the day the betting operator was registered. (2) The notice may also state any other matters that are reasonably incidental to the performance of the betting operator's obligations under this Act or the Taxation Administration Act 1996. Note— Examples of other matters include— (a) the betting operator's client number, and (b) records required to be kept under the Taxation Administration Act 1996 relating to the betting operator's liability under this Act. 13I Cancellation of registration (1) The Chief Commissioner must cancel the registration of a person as a betting operator under this Part if the person has— (a) ceased to be a betting operator, and (b) lodged all returns the person is required to lodge under this Part, and (c) paid the person's liability in relation to those returns. (2) As soon as practicable after cancelling a person's registration under subsection (1), the Chief Commissioner must give the person a notice— (a) stating that the person's registration has been cancelled, and (b) specifying the day the registration was cancelled. Division 4 Returns 13J Application of Division This Division applies to a betting operator who, for all or part of a financial year, is a betting operator who— (a) is registered under Division 3, or (b) is required to apply for registration under section 13F. 13K Requirement to lodge monthly returns (1) The betting operator must, not later than 21 days after the last day of the month, lodge a return (a monthly return) in relation to the net NSW wagering revenue of the betting operator for the month. Maximum penalty—100 penalty units. Note— Part 6 of the Taxation Administration Act 1996 contains other provisions concerning returns (including provisions relating to the form of return, extensions of time for lodging returns and special tax return arrangements). (2) A monthly return is to be in an approved form. (3) Subsection (1) applies even if the betting operator's monthly liability for the month is nil. Division 5 Betting operators to identify person's location 13L Obligation of betting operator to identify person's location (1) A betting operator must, when receiving a bet, take reasonable steps to identify the location of the person making the bet. Maximum penalty—100 penalty units. (2) For the purposes of subsection (1), a betting operator may rely on the following as being the location of a person making a bet with the betting operator— (a) for an individual—an address given to the betting operator by the individual as the individual's residential address, (b) for a corporation—an address given to the betting operator by or for the corporation as the corporation's principal place of business. (3) However, subsection (2) does not apply if the betting operator knows, or has reasonable grounds to suspect, that an address specified in subsection (2) (a) or (b) is not the location of the person when the bet is made. Division 6 Hypothecation of tax revenue 13M Appropriation and payment of revenue to industry (1) The Treasurer is, in respect of a financial year in which point of consumption tax was collected, to pay an amount equal to 33% of the prescribed amount to the following bodies— (a) Racing New South Wales, (b) Harness Racing New South Wales, (c) Greyhound Racing New South Wales. (2) The amount determined under subsection (1) is to be paid in quarterly instalments in the following proportions— (a) to Racing New South Wales—72%, (b) to Harness Racing New South Wales—15%, (c) to Greyhound Racing New South Wales—13%. Note— The proportions specified in this subsection are the same as the proportions for the distribution of amounts under the Racing Inter-Code Deed dated 27 February 1998 between NSW Racing Pty Limited, the NSW Thoroughbred Racing Board, Harness Racing New South Wales and the Greyhound Racing Authority (NSW) as in force on the commencement of this section. (3) If the Treasurer determines that a body was overpaid or underpaid in respect of any financial year, the Treasurer may deduct an amount from, or pay an extra amount with, a subsequent payment under this section to that body, as the case requires. (4) Amounts required to be paid under this section are to be paid from the Consolidated Fund, which is appropriated accordingly. (5) In this section— prescribed amount, for a financial year, means the amount of point of consumption tax payable under this Part during the financial year, less the amount of any offset against the point of consumption tax under section 13P. quarter means a period of 3 months ending on 31 March, 30 June, 30 September or 31 December. 13N Appropriation and payment of revenue to Responsible Gambling Fund (1) The Treasurer is, for the period from 1 January 2019 to 30 June 2019, to pay $2,500,000 to the Responsible Gambling Fund established under section 115 of the Casino Control Act 1992. (2) That amount is to be paid from the Consolidated Fund, which is appropriated accordingly. (3) The Treasurer may, for subsequent financial years, pay to the Responsible Gambling Fund from the Consolidated Fund other amounts appropriated by Parliament. (4) Any amount paid under this section is to be the subject of the creation and operation of a trust deed appointing trustees and containing provisions approved by the Minister administering the Casino Control Act 1992 (the Minister) relating to the expenditure of that money for purposes relating to responsible gambling. (5) The trustees may make recommendations to the Minister as to the application of money (appropriate to the trust deed) for purposes relating to responsible gambling and the Minister may pay money out of the Responsible Gambling Fund in accordance with any such recommendations. (6) The trustees, when making recommendations for payment of money out of the Responsible Gambling Fund, are required to take into account any policy guidelines issued to the trustees by the Minister for the purpose of giving effect to the provisions of the trust deed relating to expenditure for purposes relating to responsible gambling. (7) The Minister may also pay money out of the Responsible Gambling Fund for any purpose that is consistent with the provisions of the trust deed but only after consulting with the trustees on the proposed expenditure. 13O Special appropriation to Greyhound Welfare and Integrity Commission (1) The Treasurer is, for the period from 1 January 2019 to 30 June 2019, to pay $2,000,000 to the Greyhound Welfare and Integrity Commission. (2) That amount is to be paid from the Consolidated Fund, which is appropriated accordingly. (3) This section does not prevent any other appropriation or payment to the Greyhound Welfare and Integrity Commission. Division 7 Offset against point of consumption tax 13P Offset of tax to totalizator licensee (1) A totalizator licensee is entitled, for a financial year, to an offset against the point of consumption tax payable by the licensee in an amount equal to the sum of the following— (a) the amount of betting tax under Part 2 paid by the licensee for that financial year less any offset for the financial year under section 11, (b) the tax reduction amount for that financial year paid by the licensee under section 70 of the Totalizator Act 1997. (2) For the avoidance of doubt, if in relation to a financial year the amount of a totalizator licensee's offset under this section is greater than the amount of the totalizator licensee's point of consumption tax liability under this Part, the totalizator licensee is not entitled to a refund of that excess amount. (3) Nothing in this Part requires a totalizator licensee to pay point of consumption tax for any period before the offset under this section for that period is applied to that liability. Note— Division 2 of Part 6 of the Taxation Administration Act 1996 enables the Chief Commissioner to approve special arrangements for the lodging of returns and payment of tax under taxation laws. Division 8 Multi-jurisdictional agreements 13Q Treasurer may enter into agreements (1) The Treasurer may enter into an agreement (a multi-jurisdictional agreement) with 1 or more other Australian jurisdictions to establish and implement processes for achieving improvements in the assessment and collection of taxes, interest and penalties imposed by the participating jurisdictions on betting operations that are carried on in multiple jurisdictions. (2) A multi-jurisdictional agreement may— (a) provide for the collection of taxes, interest and penalties by a participating jurisdiction on behalf of other participating jurisdictions and for the distribution of amounts so collected, and (b) provide for each participating jurisdiction to collect, on behalf of all participating jurisdictions,