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Source: New Zealand Parliament – Hansard

Hon KIERAN McANULTY (Labour): I thank the Minister for that response. I’m interested, in particular, in the forecast revenue that’s stated by the Minister, given that when this policy was announced prior to the election—and that is relevant to point out given that in numerous responses to Part 1, 2, and 3 during this committee stage last night, the Minister pointed to the fact that these elements were campaigned on as justification for not having a select committee process—the figures used pre-election were $180 million. So it’s interesting to note that the forecast revenue had reduced.

But my question, following on from those responses, is: where is it outlined in here that it is casinos only? I know that that is what the Minister has referred to in his brief responses in other parts, but this is talking about offshore gambling. If there is a distinction between casinos, sports, and racing, it’ll be useful for him to outline to the committee how that is. There is a legitimate concern around revenue lost to offshore operators around sports and racing.

I assure him that these are genuine questions. This is an area of interest of mine. When I was racing Minister, we put a lot of work into this; there is work sitting there ready to go. I’m just understanding, given his comment that it is out of scope—I’m not convinced that’s the case, but it might be useful to the committee if he can just explain how that is the case.

Hon BARBARA EDMONDS (Labour—Mana): Thank you, Mr Chair. I too want to speak to New Part 2C on the offshore gambling duty for this part of my contribution, and there’ll be other questions in relation to the new parts that have been inserted. It’s quite important, I think, that Parliament be given the opportunity to really debate this part of the bill. The reason is that it is part of the Minister’s Amendment Paper, but it has not been subject to any public submission process. So, yes, we’re under extended sitting, but time and time again, when the committee of the whole House was meeting yesterday, or the day before, members had been asking why Ministers couldn’t split off the annual rates part of the bill in order to allow a public submissions process for for the other elements of the bill which are more complex, which haven’t actually gone through the select committee process.

So I just wanted to make that point quite clear: this particular offshore gambling duty has not been subject to public submissions, and my concerns about that: I raise them, perhaps, on behalf of the Problem Gambling Foundation, who I’m sure would have probably had some very thoughtful submissions as part of this offshore gambling duty, because obviously what’s not quite clear within this part is around gambling harm minimisation. But, nevertheless, I do want to ask the Minister: given there’s been no select committee process as part of this bill, whether there’s been, actually, anything around the generic tax policy process, which is the general sort of consultation process that Inland Revenue goes through: sometimes they issue an officials’ issues paper, or the Government will release a discussion document, and then they will call for submissions. Submissions will come in, then the Minister will agree to changes, and then it’ll come through the House, through Parliament. So my question is: was there no opportunity for a generic tax policy process in the development of this offshore gambling duty? Who did the Minister consult with? Or who did officials consult with in the formulation of this policy?

Now, I know that the Minister will, quite clearly, say, “We took this to the election. We have the mandate to be able to do it.”, but as members of the House quite clearly said a number of times yesterday, in order to make sure that you’ve covered all the bases, that you don’t have any unintended consequences, the public submissions process is quite important. So I want to know who did officials speak to to test this policy; name who. I know that during the election campaign, it was revealed that part of this was part of a SkyCity briefing to different members of Parliament. I mean, even I received that briefing from SkyCity—you know, that we should tighten up this offshore gambling.

So I just want to know, specifically, who was consulted, when were they consulted, were other members of the harm minimisation community consulted, and was their advice proactively sought? If so, what was their advice, or what was their response back to that request from officials or the Minister?

And I just want to make the point clearly: there has been no select committee process. This is the only time we get to scrutinise this brand new tax. It is a brand new tax. And this is the only time that the Parliament will be able to scrutinise it. So thank you, Mr Chair.

Hon SIMON WATTS (Minister of Revenue): Thank you very much, Mr Chair. Just in response to a few of those questions. To the Hon Kieran McAnulty, in terms of the comments around sports and other aspects: the current policy that we’re working through here does exclude those betting on sports and racing, as there actually is an existing requirement for those entities to pay a 10 percent point of consumption charge to the Department of Internal Affairs (DIA), and that consumption charge is built into the model. It is important to know, and I think the member does raise some aspects in terms of the consistency, but we are considering and working through the details of the implications on both the racing sector and the sports aspect to ensure consistency. But the purposes of this bill, and where we are at this point, noting the time line, is very much focusing on the offshore gambling operators, in the first instance.

There were some other questions in regards to harm minimisation, and I think one of the members was referencing that. Quite a lot of conversation was had in regards to the importance of ensuring that harm minimisation that is available domestically through the provision of onshore gambling entities is afforded to those that are in the offshore aspect. And that’s quite challenging, obviously, in terms of practical implementation, but from the pure consumer point of view, you know, they’re reasonably agnostic on whether, online, that is a New Zealand domestic entity or an offshore one. So the licensing regime is a key element in terms of ensuring that we do have the appropriate wraparound and regulatory model around that—primarily, not only to capture those players on a consistent playing field but also to ensure that their provision of harm minimisation is consistent, irrespective of jurisdiction and where that comes from.

I noted before, just in regards to the revenue, and I provided a range, the actual aspect is $149 million, without regulation, over the forecast period—I think that was the midpoint of the range that I quoted—and the overall forecast period of the revenue, including regulation, is $193 million. So—just carrying that.

I think, just in regards to the other questions around consultation that the Hon Barbara Edmonds was referring to, there was consultation, and, you know, the previous Government will be aware that these are issues that were considered—this issue, in particular, more broadly, was considered, so DIA did consultation in 2019. The actual element in regards to the gaming duty wasn’t formally consulted on, but was included, as I noted before, in the National Party’s pre-election materials and published tax plan.