New Zealand Election: Foreign Gambling Income Sparks Debate

New Zealand’s two primary political groups are engaged in a fervent argument about foreign gambling income in the forthcoming election.

The Labor Party, the current administration, has rejected the National Party’s assertions that it would partially finance its spending proposals by compelling foreign gambling operators to pay more taxes if the party prevails in the election. The election is set for October 14th.

The National Party has asserted that it can generate NZ$179 million annually from foreign operators as part of its NZ$14.6 billion (NZ$8.7 billion/€8 billion/£6.8 billion) tax reduction package.

Nicola Willis, the National Party’s second-in-command, stated that this would be accomplished by “eliminating tax loopholes and ensuring that foreign operators providing online gambling services to New Zealanders pay their fair share.”

Willis informed reporters that presently, no Goods and Services Tax (GST) is collected on the entire illicit market. The National Party would compel online casino operators to register and disclose their earnings.

Services that fail to comply would be subject to IP geo-blocking. Willis also mentioned that her figures include additional corporate tax and casino fees.

The Labor Party has criticized the National Party’s projections.
Labor stated that the estimations of the market size are based on research from TAB and Lotto. It added that GST revenue would be less than NZ$40 million annually.

Barbara Edmonds, the Labour Party’s representative for income and internal affairs, stated: “In contrast to the National Party’s financial strategy, there is no ‘tax loophole’ in internet gambling conducted outside of New Zealand.

“We also challenge the cost estimations provided by the National Party, asserting that an average of NZ$179 million in income per year could produce NZ$716 million in revenue over the projected timeframe.

“As [National Party revenue spokesperson] Andrew Bailey is aware, online casinos have only generated a total of NZ$170 million in the seven years since the introduction of the Goods and Services Tax (GST).”

New Zealand has been imposing a 15% GST on services and intangible assets supplied remotely by foreign providers since October 2016. This includes remote gambling service providers who earn more than NZ$60,000 in revenue from New Zealand residents.

New Zealand Gambling Policy
Kieran McAnulty, Labour’s racing spokesperson, also indicated that the National Party’s financial plan risks double-counting the revenue currently being received from foreign operators.

“Foreign platforms that offer sports and horse racing betting currently pay approximately NZ$4 million in point of consumption tax annually, which is returned to New Zealand sports and racing organizations for community welfare and harm reduction initiatives,” McAnulty said.

“It is regrettable that the National Party’s plan to tax foreign platforms does not include any provision for minimizing harm reduction efforts for problem gambling.”

Its essential for them to elucidate if their proposal implies that community and sports funding will be reduced to finance tax cuts.

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