A new book that goes behind the scenes to investigate the financial and political workings of the NSW club gaming industry will be launched today (14 October) by the Honourable Bob Carr, former Premier of NSW, just days before a draft report of Commonwealth Productivity Commission Inquiry into gambling is due out.
Casino Clubs NSW: Profits, tax, sport and politics, by Betty Con Walker and published by Sydney University Press, proposes a review of public policy towards clubs, of the way gaming revenues are taxed, and the accountability of the club industry.
The NSW club gaming industry is a multi-billion dollar business with big clubs operating more poker machines than many casinos, but not subject to the same scrutiny as casinos. NSW has some of the largest registered clubs in the world. Their supposed status as ‘mutuals’ allows them to pay little, if any, corporate income tax. Above all, they benefit from low state tax rates on gaming profits – far below their competitors, hotels.
Casino Clubs NSW describes how big clubs have attained and retained a dominant position in the gaming industry. While recognising the enormous positive role of small mutual clubs, it questions the continuing government support to big clubs through tax and regulatory concessions.
Using carefully gathered evidence it explodes claims that the bulk of club profits from gaming is spent on contributions to the community and the sponsoring sport. In fact some clubs make a net profit on sport, and cash community contributions are miniscule in relation to club gaming revenues. As Con Walker shows, the gaming revenues of clubs are primarily spent on management, capital works and subsidised sales of food and alcohol.
Casino Clubs NSW also presents the story of public campaigns, private lobbying and back-room machinations aimed at blocking a 2003 decision by Premier Bob Carr and Treasurer Michael Egan to increase taxes on the gaming profits of clubs.
The tale is told through a combination of documentary and oral evidence – including the often-conflicting and acerbic accounts of participants, be they politicians, media representatives or public officials. Carr and Egan resisted the 2003 campaign but incoming Premier Morris Iemma backed down in order to obtain the support of some disaffected backbenchers. Hundreds of millions of dollars are being lost in state taxes, and the price is rising.
