Licensed clubs in the ACT were put on notice more than a year ago. They were warned that they should be doing more for charity and sport in the ACT in light of the significant tax benefits and near-monopoly over poker machines they enjoy. Nothing much has changed. A year ago the Commissioner for ACT Revenue reported precise details on how much of net poker machine profits went to sport and charity. Precious little, it was revealed. A year later the commissioner has now published a second annual report as required by the Gaming Machine Act. Again it is revealed that the clubs are giving precious little to sport and charity from net poker machine profits. Out of a total of net poker machine profits of $92.6 million, sport and charity are getting a pitiful 3.6 per cent, only a tad up from last year’s 3.4 per cent from $86.8 million. Added to the latest 3.6 per cent is a further 1.3 per cent given in kind.
In all, though, out of more than $1 billion that goes through pokies every year in the ACT, charities and sport are getting just $4.6 million.
Surely, the game is now up. The monopoly on poker machines and the tax benefits should be reviewed. Or the Government should levy an amount and dish it out to sport and charity itself in an open and accountably way. Clearly, the clubs cannot be relied up to do the right thing.
Labor’s deputy leader, Ted Quinlan, asserts that the report is a “”deliberate distortion” of the clubs’ contribution to the community. Self-serving twaddle. Labor collects substantial amounts from the Canberra Labor Club ($264,000) and the Canberra Tradesman’s Union Club ($588,328) so has a conflict of interest in dealing with the matter in the Assembly. A conflict it neither acknowledges or does anything about.
Rather than a distortion, the commissioner paints a picture of chilling accuracy down to the second decimal point.
Moreover, the commissioner reports on contributions which are not strictly eligible as sport and charity donations under the Act in order to give a more accurate picture of the clubs’ role. The extras include infrastructure spending and donations to associated organisations which might result in some public benefit. But even when these extras are added, the picture remains a miserly one when stacked up against the tax and monopoly benefits enjoyed by the clubs. Just 12 per cent of net poker machine revenue finds its way into the wider public domain. The rest is ploughed back to the clubs.
This is compounded by the distortion that the poker machine revenues have put on club membership. The memberships of many large clubs are now far too large to retain any community of specific interest. Indeed, the only commonality appears to be cheap food, drink and entertainment provided by the fruits of poker machines. Without them, the club membership would fall away. Moreover, “”membership” of many clubs is a farce, involving little more than payment of a nominal sum at the door.
Poker machines, over the years, have warped the club concept. Many people who go to clubs are more patrons than members. They go for the food, drink and the machines rather than any serious commitment to the cause of the club.
The original reason for tax concessions was that the club was seen as doing worthwhile community work and was in a way an extension of people gathering in a home. Poker machines have changed that. It is time to restrict the tax concessions to clubs without machines and treat clubs with machines as the businesses that they have become.
Incidentally, the clubs’ poor performance should be compared with that of the few hotels which are permitted poker machines. The hotels contributed 17.5 per cent of their net poker machine revenue to charity and sport, a much better result.
On that evidence, there would be nothing to lose by allowing all hotels to have poker machines and/or by treating all clubs as businesses for tax purposes.