Wages of Sin in Victoria Will Not Result in Death of Bookies
We begin by saying that Point of Consumption taxes might be the fairest form of taxation, as the person or persons paying the tax can avoid the tax by avoiding the taxed activity.
Ultimately, any tax in any form is passed along to the consumer. Businesses either make a profit or they shut the doors, so the end result of Victoria’s recent announcement that it is after an eight percent share on the bookies’ net revenue from online wagers, set to take effect on 1 January 2019, means that odds on markets will decrease by at least that amount and margin percentage will increase.
The other certainty of the situation is that corporate bookmakers will find creative definitions for“net revenue,” as they no doubt already are doing.
Yet another certainty is that Sportsbet, Ladbrokes, William Hill, et al will not shut the doors and switch off the lights any time soon.
To paraphrase some famous literature, “Render to Turnbull the things that are Turnbull’s.”
What was true 2,000 years ago remains true today. Governments are addicted to tax revenue. The high from new sources quickly fades and newer and larger fixes are required.
In one of those subtle ironies that seem to crop up almost constantly, in the U.S., the highest court in the land has determined that preventing the various states from offering wagering on sporting events is unconstitutional. Translated, all that means is that what is preventing the Yanks from having a punt is that the various taxing agencies have yet to figure out how to get in on the action.
Whose action is that? Well, the major codes of the NFL, NBA, NHL and MLB oppose letting states set up sports books, because, in their opinion, it would jeopordise the “integrity” of their games. This would tend to make the cynical think that the U.S. pro leagues get a nice slice of the estimated $150 billion in illegal wagers placed each year by U.S. punters.
We needed a good laugh today, but would never in a million years question the integrity of the NFL, NBA, NHL and MLB.
What has this to do with horseracing?
A simple example.
If the Victorian initiative raises the price on the bookies by eight percent, you can be assured that the odds on your selected galloper will decrease by 10 percent or more.