Australia has one of the highest rates of gambling in the world. With more than 80 per cent of Australian adults engaging in gambling of some kind. This includes four per cent of the adult population who play poker machines once a week.

Traditionally, gambling has been legislated at a state and territory level, rather than by the federal government. There are numerous Acts in each region that outline information about gambling tax laws and regulations.

envelop filled with Australian money

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History of Gambling Tax Legislature

In Australia, the winnings from gambling are not taxed. This is for three reasons.

Gambling is not recognised as a profession in Australia. It is regarded as a hobby or recreational activity. The Australian government has come to an agreement that the gains from gambling activities are often the result of good luck, not hard work.

Even if someone wins big, many people also lose a lot in other gambling sessions. For example, skilled professional gamblers, such as online poker players. Who could argue their winnings are the result or skill instead of luck. Are not asked by the government to pay taxes on their winnings.

If the player decided to register themselves as a business though, they might need to pay tax. If the player received sponsorships, endorsements and other gains because of their professional gambling career, then this would be taxable.

Who Pays The Gambling Tax in Australia?

The main reason behind the lack of taxation on gambling winnings is that the gambling operators pay the taxes instead of the players. This taxation differs between the regions.

There are taxes on the turnover amount, on player loss and net profit. As such, gambling operators need to obtain a license to offer their services. And pay certain fees during the development of the operation. The operators’ requirements to pay tax differ based on where they are operating and what form of gambling they offer players.

For example, in the state of New South Wales. The tax on electronic gaming machines in casinos is between 16.41-38.91 per cent of gross revenue, depending on the gross revenue.

This is different from the state of Victoria, where the tax is 31.57-51.57 per cent of gross gaming venue.

players gambling on a tablet

What are the Online Gambling Tax Rules in Australia?

In Australia, the Interactive Gambling Act (2001) governs the rules and laws about online gambling. This is a national law and that was first enacted in the Australian Parliament on June 28, 2001. The Act targets online gambling operators. And makes it an offence for them to offer ‘real-money’ online interactive gambling to residents in Australia.

That hasn’t done much to stop Australian’s spending big online, with $800 million spent by 2010. Accessing and using interactive gambling services is not an offence in Australia. It is also permitted for companies based in Australia to offer their services to gamblers located outside Australia. The only exception being those countries that were called ‘designated countries’. Australian punters benefit from not having to pay tax on their gambling winners. However, when it comes to online gaming, there aren’t many Australian providers.

Since few are actually based in Australia, there is a foreign transaction fee that some users will have to pay to make a deposit or withdrawal. This is dependent on what kind of banking method you use.

For example, Mastercard and Visa will generally charge a foreign transaction fee. Whereas Skrill, won’t charge one. There is also the issue of currency conversion. As some of the best casinos available might not offer the option to play in the Australian dollar.

new rules sign with a white backdrop

Do Players Have to Pay Any Gambling Tax in Australia?

In Australia, it is the gambling operators pay tax, not the players. The amount of tax the operators pay depends on the type of game and the location of the poker machines or casinos.

There is no tax to pay for online Australian players either, despite a few online Australian casinos in operation.

The only fees or charges a player might encounter when playing an online casino. These could be fees to withdraw or deposit money into international casino sites or when converting the Australian dollar into the website’s preferred currency.

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