Page 3519 - Week 12 - Thursday, 20 September 1990
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the Government as part of its budget. It increases the maximum allowable denomination for use in gaming machines from 20c to $2; it increases the number of class B gaming machines which can be installed in hotels providing accommodation from three to 10; and it introduces a new tax regime for gaming machines. It is that last change, the new tax regime, which could probably be seen as the most controversial.
We must always keep in mind when discussing the taxation of poker machines that licensed clubs are a very significant industry in the ACT. They employ around 2,000 people; they contribute to our important tourism industry; and they contribute greatly to the community in general. That, of course, is not to mention the significant revenue they provide to the budget. So it is very important that the taxation system on those licensed clubs does not kill the goose that lays the golden egg.
Mr Speaker, I think it is fair to say that in general licensed clubs will not be too concerned about the new tax regime and, in fact, very small clubs with less than, say, 10 gaming machines will actually benefit from the new system. Medium sized clubs will be affected little. It is the five or six largest clubs who will be most affected and from whom by far the largest proportion of the additional revenue will be generated.
My understanding, Mr Speaker, is that most of the clubs believe that the availability of $1 and $2 machines will largely compensate the large clubs for the new tax regime; but I would like to make a couple of points about that new regime. As a result of this new system, large ACT clubs could be expected to pay around 25 per cent more than their New South Wales counterparts. This is largely the result of the expected abolition of the gaming machine licence fee in New South Wales in December. The ACT is to retain a dual licence fee net revenue tax system. In addition, it is likely that it will take some time for GALA to arrange new contracts for the provision of $1 and $2 machines, so clubs may be in a position where they are facing a new tax regime designed to offset the benefits of the new machines well before the new machines are, in fact, available. I would urge the Minister to ensure that there are no delays in the introduction of the new machines by making that a priority for GALA.
Finally, Mr Speaker, the Minister would be aware that New South Wales clubs are able to have a pay-out ratio of 95 per cent on their $1 and $2 machines. Clubs find that these machines become more attractive to consumers if a larger pay-out ratio is available because it allows the consumer to use the gaming machines for a longer period for a given price.
Mr Speaker, I foreshadow that in the detail stage I will be moving an amendment to increase the maximum pay-out ratio to 95 per cent. I would like to emphasise that this does
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