Australia is the "gambling capital of the western world, where punters spend more per head than anywhere else on earth," according to Jamie Smyth of the FINANCIAL TIMES. However, bookmakers warned that "the party is over for the industry." Australian bookmaker Sportsbet CEO Cormac Barry said, "There are tough times ahead with the introduction of new point of consumption taxes and advertising rules. This is an earthquake -- a seismic event for the industry." Gambling is a A$23B ($17.6B)-a-year business in Australia, where "having a flutter on the horses, playing the pokies (poker machines) in pubs or visiting a casino is part of everyday life for many." But a "combination of cash-strapped state administrations and concerns about problem gambling has created a political backlash against gambling operators," which face higher taxes and changes to a "light-touch" regulatory regime. In July, the state of South Australia introduced a 15% consumption tax on net wagering revenues or gambling losses on bookmakers. Western Australia will follow suit on Jan. 1, and "other states are expected to follow." Sportsbet warned that its pre-tax profits, which were A$175M in the financial year to July, "could halve if the consumption tax is introduced across Australia." The racing industry, which depends on bookmakers for a "large slice" of its revenues, is concerned the levy "could dent its finances and its ability to host world class events such as the Melbourne Cup." Racing Victoria CEO Giles Thompson said, "It depends on how the tax is implemented by each state and this is not yet understood" (FT, 11/6).
