Page 580 - Week 02 - Thursday, 20 February 2020
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Since July 2017 the gaming machine tax rebate has allowed clubs to reinvest in their organisations in a diverse range of ways to direct their income streams away from a reliance on gaming machines into the future.
In order to ensure that the rebate was delivering the intended outcomes, the government committed to a review of the tax rebate, which I tabled on 28 November last year. The gaming machine tax rebate statutory review report focused on whether the rebate contributed to clubs’ continued financial viability and supported their ongoing contributions to the ACT community. This bill implements the findings and conclusions of that report. The report found that the rebate achieved its purpose, creating a more conducive financial environment for clubs to diversify their revenue streams. Accordingly, the bill continues the gaming machine tax rebate scheme, with some additional tailored measures for small and medium clubs and club groups.
The bill also makes changes to the rebate to improve its operation and effectiveness. In his report, ACT Club Industry Diversification Support Analysis, Mr Neville Stevens AO recommended a phased reduction of the rebate for small and medium clubs or club groups that earn more than $4 million in gross gaming machine revenue in a year.
Under the current framework, a club that exceeded this threshold would be required to repay the entire rebate that they had received, even if they exceeded the $4 million annual threshold by just a small amount. In response to this concern, the bill replaces the rebate’s previous threshold and eligibility provisions with a phased reduction model. The new model will operate with the effect that any rebate received by a club whose gaming machine revenue goes over the $4 million threshold will be reduced by 50c for every dollar of gaming machine revenue that goes over that threshold.
The threshold in the act capped eligibility for the rebate at $4 million earnings in the 2017-18 financial year on an ongoing basis. This meant that a club that earned under $4 million in the 2017-18 financial year would be eligible for the tax rebate into the future regardless of their current earnings. This bill amends the eligibility provision by capping it at $4 million in the relevant financial year.
The bill also redefines small and medium clubs and club groups to include any club that receives some amount of the rebate through the operation of the phased reduction provisions, as well as those clubs with gross gaming machine revenue of less than $4 million.
These provisions will progressively reduce the amount of the rebate received by clubs that exceed the threshold, reflecting each club’s current gaming machine revenue and their progress towards diversification. Importantly, however, these clubs will still be considered small and medium clubs and club groups up to the point that their rebate amount reaches zero dollars. In this way, the phased reduction will foster rather than hinder clubs’ efforts to diversify.
The bill also makes minor amendments to the community contributions scheme, to improve its operation and efficiency. The government has worked to enhance the effectiveness of the scheme and to maximise its returns to the community. This bill
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