From 1 January 2020, a point of consumption tax will apply to all betting operators licensed in Australia where their net wagering revenue (NWR) from Tasmanian bets exceeds the annual tax-free threshold.
The POC tax rate is 15 per cent of the NWR and the annual tax-free threshold amount is $150 000. However, for the 2019–20 financial year, the threshold amount is $75 000 as the tax will only apply to the second half of the financial year.
Monthly reporting and payment requirements
Betting operators that reach the annual threshold amount must:
- register on the online portal (discussed below);
- lodge monthly NWR returns no later than 21 days after the end of each month; and
- pay any POC tax liability in relation to a reporting month no later than 21 days after the end of each month.
Failure to register, and late lodgement of returns or payment, may result in penalties and a requirement to pay interest on any outstanding debt.
Online registration and reporting portal
An online point of consumption tax portal has been developed for electronic registration, monthly lodgement of returns and payments via Tasmanian Revenue Online.
For guidance on using the online portal, please refer to the Point of Consumption Tax - System Help Guide.
POC tax calculation and exclusion of free bets
A free or bonus bet is an amount of credit offered by a betting operator for a customer to use to wager on a particular betting market or product. For the purpose of calculating the POC tax, the face value of free bets, ie the value of the credit, is excluded.
The POC tax of 15 per cent is payable on the net amount of wagering revenue earned by the betting operator from Tasmanian customers - ie money wagered minus winnings paid; and/or commissions earned facilitating bets such as from a betting exchange. An example of how NWR is calculated is provided below in frequently asked questions.
Identifying Tasmanian customers
All reasonable steps must be taken by betting operators to identify when services are used by Tasmanian customers at the time the bet is placed.
It is acceptable for a betting operator to rely on the residential address registered by an individual customer or a business address registered by a corporation. However, if the betting operator knows or has reasonable grounds to suspect that the registered address is not the location of the person when the bet is made, the operator must use the location at which the bet is made.
Exemptions regarding timing of monthly return
On-course bookmaker exemption
- On-course bookmakers that exceed the annual threshold must register but are only required to lodge and pay tax on an annual basis. Otherwise, on-course bookmakers can choose to lodge monthly returns by giving written notice to the Commissioner of State Revenue. A guideline on how to lodge a notice is available here.
Corporate bookmaker exemption
- Under exceptional circumstances, an exemption from the requirement to lodge monthly returns may be granted by the Commissioner of State Revenue. Further information on how to apply for an exemption, and the relevant circumstances the Commissioner may consider, can be found here.
This webpage is updated periodically as the POC tax framework is implemented. Further guidance by way of frequently asked questions is provided below.
If the FAQs have not answered your question, please contact the Liquor and Gaming Branch on (03) 6166 4040 or firstname.lastname@example.org.
Frequently asked questions
Does the point of consumption tax capture all types of gambling?
Tasmania's point of consumption tax applies to all wagering and betting types or products offered to customers in Tasmania, including race wagering and sports betting, or betting via a totalizator or betting exchange. Other gambling products, including electronic gaming machines, casino games, lotteries, TASKeno, raffles, bingo and scratch cards are not subject to the tax.
Does the point of consumption tax apply to betting operators or products licensed in other states?
Yes. Betting operators licensed in Tasmania or in other Australian jurisdictions offering and accepting bets from customers located in Tasmania are liable to pay Tasmania's point of consumption tax.
Are bets placed before 1 January 2020 taxable?
No. Bets placed before 1 January 2020 on an event that takes place on or after 1 January 2020 are not included in the calculation of net wagering revenue under the point of consumption tax. Any payout of winnings from those bets cannot be claimed as a deduction in the calculation of a betting operator's net wagering revenue.
How is net wagering revenue calculated?
The net wagering revenue of a betting operator includes revenue derived from all betting services provided to customers located in Tasmania. The POC tax of 15 per cent is payable on the net amount of wagering revenue earned by the betting operator from Tasmanian bets - ie money wagered minus winnings paid; and/or commissions earned facilitating bets such as from a betting exchange.
Example: Fixed odds bets
A Tasmanian bet of $50 is placed with a betting operator, which includes a free bet component with a face value of $20. The Tasmanian bets wins $100. The betting operator deducts $20 from $100 to recoup the cost of the free bet. This results in a net payout of $80 to the customer.
The following table illustrates how the betting operator is to calculate net wagering revenue for this winning bet, and also includes the calculation required in the event of a losing bet.
Is a bet included in the calculation of net wagering revenue when the bet is placed, or on settlement of the bet?
Bets other than with a totalizator or betting exchange should be included in the calculation of net wagering revenue at the time the bet is placed with the betting operator. Any payout relating to these bets (including winnings or a refund of the bet amount if the bet is cancelled) would be included in the month in which the payout is paid or becomes payable.
How are free bets treated?
Free bets (also known as bonus bets) made by customers located in Tasmania with a betting operator are not to be included as bets received or accepted in calculating net wagering revenue. Also, there is to be no reduction in net wagering revenue for awarding or providing free bets to Tasmanian customers.
Is the net wagering revenue the GST inclusive amount?
The net wagering revenue of a betting operator for the purposes of the point of consumption tax is the GST inclusive amount.
Are Tasmanian on-course bookmakers subject to the point of consumption tax?
Yes, Tasmanian on-course bookmakers are liable for the tax. However, the reporting and payment requirements are annually instead of monthly, which is intended to be less onerous.
How is the point of consumption tax enforced against betting operators?
The Taxation Administration Act 1997 (Tas) gives the Commissioner of State Revenue the power to undertake various compliance and investigation activities. In addition, the Commissioner can impose administrative penalties and interest for tax defaults, such as late payments.
Glossary of point of consumption tax terms
Get to know the terms below to help your understanding of point of consumption tax.
Annual threshold amount – The annual threshold amount is $150 000. For the 2019‑20 financial year, the threshold is $75 000 reflecting that the first financial year is a half year.
Bet – includes a wager on any approved contingency (including racing, sports, elections, current affairs, and entertainment), a free bet and a lay-off bet.
Betting operator – a person that holds a licence or authority (however described) under the legislation of an Australian jurisdiction to carry out betting services.
Betting service includes:
- accepting or offering to accept a bet;
- inviting a person to place a bet;
- facilitating the placing of a bet.
Free bet – is a wager made wholly or partly using an amount that is provided to the person making the wager by the betting operator with whom the wager is made; and is not immediately redeemable by the person for cash.
Lay-off bet – a wager 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 for bets made with them.
Net wagering revenue (NWR) – a betting operator's total wagering turnover (excluding the face value of free bets) less their total eligible winnings and refunds for the relevant return month.
Qualifying month - in relation to a financial year, for a betting operator, means the first month of the financial year in which the net 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 $150 000 (except for 2019-20 which commences on 1 January 2020 with an annual threshold amount of $75 000).
Tasmanian bet – a bet made by a person who is located in Tasmania when the bet is made.
Tax rate –the rate is 15 per cent of a betting operator's net wagering revenue from Tasmanian bets that exceeds the annual threshold amount.