Conservative Victory In New Zealand Augurs Online Tax Reform

October 16, 2023
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New Zealand’s voters have turfed out the nation’s Labor government, guaranteeing a conservative successor and likely online gambling reforms that will tax local-facing offshore operators.
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New Zealand’s voters have turfed out the nation’s Labor government, guaranteeing a conservative successor and likely online gambling reforms that will tax local-facing offshore operators.

The conservative National Party breezed past Labor on Saturday (October 14) to secure the largest number of seats of any party, but National may require two coalition partners to rule, according to Electoral Commission preliminary results.

National leader Christopher Luxon is waiting on final results before he and established coalition partner ACT New Zealand can name a government.

But Luxon may also require the support of the resurgent New Zealand First Party, whose leader Winston Peters is a former deputy prime minister and racing minister who has had outsized influence on gambling policy.

Although Peters’ influence could moderate the conservative agenda in a host of areas, he appears to be supportive of Luxon’s proposal to tax foreign online gambling companies that target New Zealanders and establish a regulatory regime to enforce it.

Peters told a campaign event on September 2 that although National’s proposed tax policy “doesn’t stack up” overall, the policy to tax offshore online gambling companies was a “brilliant” idea.

The National tax policy released in late August warns that offshore operators “currently benefit from a loophole” in being able to “dodge” tax because the law does not require them to register with the authorities.

The policy, if implemented, would compel offshore operators to “register and report their earnings for tax purposes”, while geo-blocking those “services that do not comply with the New Zealand licensing regime”.

A Luxon government would establish a regulator to enforce changes to online gambling tax policy, the document says.

Meanwhile, New Zealand-based casino operator SkyCity Entertainment Group announced on Monday (October 16) that CEO Michael Ahearne will step down at the end of March 2024 and return to Ireland with his family. A search for his replacement has begun.

The company did not say why Ahearne had resigned, with SkyCity chair Julian Cook instead praising him for his “tireless” leadership over a “complex and demanding” three years, including Ahearne’s handling of the coronavirus pandemic, a fire at the company’s convention centre project and cascading regulatory pressure in New Zealand and Australia.

The latter included a share price-depleting warning that it could lose its casino licence in New Zealand over possible responsible gaming failures, a probe in South Australia to determine the company’s fitness to operate its Adelaide casino and a potentially damaging fine from Australia’s anti-money laundering watchdog AUSTRAC.

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