Legalization of online gambling-revenues from remote gambling in Budget 2019
31 January 2019
Is the outcome of the plenary sessions in the first chamber already known? After indications from anonymous sources around the cabinet and the content of the state budget of 2019, we can only draw one conclusion: the law will almost certainly get through. Legal online gambling is most likely to be a fact from mid-2020.
In the National Budget 2019 we read, among other things, about the budgetary consequences of the legalization of Remote Gambling. There will be only the gambling tax on sports betting assumed $ 6,000,000 in additional tax revenue in 2020, from 2021 there should be $ 12,000,000 annually. Other casino games such as bingo, blackjack, roulette or poker have not yet been included in this. If the calculated budget is not released, this is almost always problematic for the relevant ministry. In recent decades, there has rarely been a national budget surplus. The hole should then be closed by cutting or by siphoning water from other jars. That process is difficult and time-consuming, so it is significant that it is included in the national budget.
Source: national budget
That the government is in the process of legalizing online gambling was revealed as early as 2016, when EC 33.996 it was adopted by the Second Chamber. This bill breaks the monopoly of land-based sports betting providers. On February 5, 2019, the first chamber will begin the plenary consideration of this law. The proposal also EK 34.471 , which abolishes the state monopoly on casino games (adopted by the Lower House on 31 January 2017) will be dealt with in the Lower House on 5 February 2019.
The modernisation of the Gambling Act offers several benefits: additional tax revenue, addiction prevention and ensuring a verifiably fair gaming offering for New Zealand players. Online gambling is a growing market in New Zealand, from one and a half million online gamblers in 2016 to 1.8 million at the end of 2018. Every year, The New Zealand company loses up to $ 175,000,000 in gambling tax revenue.
The budget for the introduction of the Remote Gambling Act (KOA) is based on 1 July 2020. The law will come into force at a time to be determined by royal decree, then the Gaming Authority will need another six months to issue the necessary permits. After this, legal remote gambling in New Zealand is a fact.
The tax liability for both land-based and remote providers shifts from player to provider, as shown by TK 35.031 . Providers will have to pay a 29% tax on the so-called ‘gross game result' (the difference between the deposits received and the prizes paid out). In the current system, the player is still the taxpayer for other games of chance such as sports betting and competitions.
However, gambling tax is only levied from prizes that exceed $ 449. Also, more tax revenue will be generated on balance, because the gambler makes less profit than the gaming company. As a result of the new legislation, The New Zealand society will have significantly more income from gambling.
The KOA bill has chosen to treat all remote gambling equally: the same tax liability and basis for all forms of Remote Gambling. This is to provide fair opportunities for the various forms of games of chance (casino games, poker, sports betting).
Sources:
Government-million euro note 2019
National Budget 2019 justice and security
Primary chamber-bill 33.996, A
Primary chamber-bill 34.471, A
Primary chamber-bill 35.031, 2
State budget-bill 35,031. 3
State budget-bill 35,031. 6
