ACT Betting Tax Hike Leads to Significant Revenue Shortfall – The Australian Capital Territory (ACT)’s 25% betting operations tax resulted in a $13.2 million revenue shortfall compared to initial government projections. This tax rate is identified as the highest in Australia, prompting warnings about driving gambling to offshore operators.
What Happened
The ACT government’s 25% betting operations tax, which is Australia’s highest, led to a substantial reduction in anticipated revenue. The government, according to The Canberra Times, had initially projected a revenue increase to $32 million after raising the tax by five percent in 2023. However, instead of an increase, revenue reportedly fell by $600,000 to $21.7 million. Revised estimates for the past financial year saw the government raise $23.7 million, which was $1.7 million more than the previous year, yet still $13.2 million below the initial expectations when the tax increase was implemented, as reported by The Canberra Times and The Oz Post.
Responsible Wagering Australia (RWA) chief executive Kai Cantwell had reportedly warned the government that the 25% betting operations tax could drive Australians to “illegal offshore operators.” Cantwell stated that the ACT government expected a “windfall” from the tax rate but budget papers now show revenue remains below expectations, with future forecasts revised down, according to The Canberra Times.
Key Details
- The ACT’s betting operations tax is 25%, making it the highest in Australia, according to The Canberra Times.
- Initial government projections for the tax expected revenue to jump to $32 million after a five percent increase in 2023, as reported by The Canberra Times.
- Actual revenue reportedly fell to $21.7 million, representing a $600,000 decrease, according to The Canberra Times.
- Revised estimates for the past financial year reportedly yielded $23.7 million, which is $13.2 million below the initial projections when the tax was first raised, as stated by The Canberra Times and The Oz Post.
- The ACT is reportedly the only jurisdiction where racing does not receive a share of the point-of-consumption (PoC) tax, contrasting with other states where 20-80 percent is returned to the industry, according to The Canberra Times.
- Canberra’s racing industry receives an annual grant through a memorandum of understanding, estimated at $8.5 million for the current financial year, The Canberra Times reported.
- An RWA report estimated that Australians were betting approximately $4 billion with illegal offshore options, a figure forecast to reach $5 billion by 2029, according to The Canberra Times and The Straight.
Why It Matters
The revenue shortfall in the ACT highlights potential challenges associated with high taxation in regulated betting markets. The Canberra Times reported that the significant difference between projected and actual revenue indicates that increased tax rates do not automatically translate to a proportional increase in government coffers. This situation, as noted by Responsible Wagering Australia (RWA) chief executive Kai Cantwell, could potentially lead consumers to utilize unlicensed offshore operators, where ‘price matters’ due to the absence of tax obligations and regulatory compliance, as reported by The Canberra Times and The Straight.
The shift of gambling activity to illegal offshore operators, estimated at $4 billion annually by RWA, suggests broader implications for consumer protection, tax revenue, and the competitiveness of licensed Australian providers. The federal government’s announced crackdown on illegal offshore gambling providers, welcomed by Cantwell, underscores the importance of policies that strengthen the regulated market against unregulated alternatives, according to The Canberra Times.
What’s Next
The ACT government now anticipates revenue growth from the betting tax to align “broadly with household income growth” over the next four years, as reported by The Canberra Times. The federal government announced in April its intention to crack down on illegal offshore gambling providers as part of a range of measures, a move welcomed by Responsible Wagering Australia, according to The Canberra Times and The Straight.
Originally reported by: The Canberra Times. Published: 6/30/2026, 1:06:52 AM.