Scope to raise more revenue from gambling and cut bad taxes

In making his case for getting Brisbane’s second casino licence, James Packer observed last week (according to the Courier-Mail):

“Brisbane and Queensland have been badly let down by Echo – they have under-invested and underperformed. Queensland taxpayers are missing out on taxes, and the people of Brisbane deserve a much better resort offering.”

While Mr Packer is obviously motivated by more than his concern for Queensland’s public finances, he makes a very good point about us missing out on tax revenue. Currently, Queensland raises much more revenue from taxes that are worse than gambling taxes and levies from an economic perspective, namely payroll tax and stamp duties (see figure below).

taxI’ve previously discussed the State Government’s reliance on inefficient taxes in a number of posts, including:

Government has to rely on inefficient taxes to fix budget – GST reform needed

Inefficient State taxes

Hence I see an opportunity to raise more revenue from gambling, which can be used to cut payroll tax and stamp duties to some extent. I wouldn’t expect gambling taxes and levies to replace these taxes fully, so broader tax reform is still needed.

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2 Responses to Scope to raise more revenue from gambling and cut bad taxes

  1. Katrina drake says:

    Government should consider making more use of tax as a mechanism to ‘nudge’ behaviour. Agree that payroll tax is an insidious tax on employment. Stamp duty is a tax on transactions – I can see that the people should have a share the revenue from land and business activity. However, stamp duty on family homes is insidious, as the stamp duty cost is usually wrapped up in the amount borrowed, so the banks do the best out of this deal by having the interest on the stamp duty amount rolling in for the next 30 years.

    Keep Taxing gambling, unhealthy lifestyles, tobacco, alcohol, litter, cars – should save us money in the long run. Such a shame governments missed the opportunity to put a postage fee on email.

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