Pokie tax threatens club aid to Church

Sydney
27 July 2003

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Pokie tax threatens club aid to Church

By Chris Lindsay

Two of Sydney’s leading Catholic social clubs say their support for community organisations and Catholic education will be devastated if State Government plans to double poker machine taxes go ahead.

“I am not over-emphas ising the disaster we face,” said John Turnbull, general manager, Liverpool Catholic Club.

“We estimate that between now and 2010 when the tax reaches its highest level the Liverpool Catholic Club will have paid $16 million in poker machine tax.

“In 2004-2005 we will pay $585,000. The next year it will be $1.1 million and in 2010 $4.1 million.

“At the moment we pay $3.8 million in tax overall, so it will be a 107 per cent increase.

“This is nearly unbelievable ... it is virtually taxing us on sales rather than profit. It is outlandish.”

Greg Kearins, general manager of Dooley’s Lidcombe Catholic Club, says the new tax will have a significant impact on the level of support that Dooleys is able to offer the community.

“In the last financial year Dooleys Club supported local schools, research, charities and tertiary institutions with donations of over $360,000 - $106,407 more than the required minimum,” he said.

“The new taxes will curb a significant amount of the club’s spending in the future.

“By 2010 the level of tax we pay, based on our current tax paid and the proposed new incremental tax rates, will have almost doubled.

“Our third party suppliers will suffer as we look to cut costs and our board will need to carefully review community expenditure.

“Growth in employment will stop, amenities will have to be restricted and the board will have to consider any donations above the minimum.”

Mr Turnbull estimates that the new tax will close most clubs within five years.

“Treasurer Michael Egan says this tax is only aimed at the top clubs and in a sense he is right,” he said.

“The smaller clubs are near to extinction anyway due to the competition from hotels with poker machines, as can be seen from the number that have already collapsed or been taken over by larger clubs.

“Clubs are non-profit so we have a basic commitment to the community and to our members.

“For the members we provide well priced food, drinks and entertainment, which we subsidise to the extent of $1 million a year.

“The club’s constitution says we must support Catholic education in the Liverpool area, which we do at about $800,000 a year.

“Another $200,000 goes to local junior sporting teams and other community groups.

“Virtually every kid in the western suburbs who runs on to a field or a netball court at the weekend gets something from a local club. The sporting club committees get to hold their meetings at the clubs at no cost.

“Three hundred girls play for the Liverpool Catholic Club teams in the local district competition. We have 15 rugby league teams, all for players under the age of 15.

“Last year the Liverpool club built eight new netball courts under lights for $850,000.

“We have just completed a $14 million function centre for the community which does not have a single poker machine in it. It will be used by schools for their annual concerts.

“We are now building a gym, ice skating rink and child minding centre - also at a cost of $14 million.

“These are all community facilities yet we are being punished for having the ability to do this.”

Mr Turnbull says other states do not have the kind of club industry that exists in NSW, which has had poker machines since 1956.

“The clubs have helped to build up communities and many community organisations rely heavily on them,” he said.

Mr Egan has said the new tax scales will be phased in over seven years from 2004-05 to bring NSW rates closer to the national average. The rates will raise an extra $46 million in 2004-05, he says.

Mr Egan’s office did not return The Catholic Weekly’s call.

ClubsNSW, the peak industry body for the state’s 1500 registered clubs, says two thirds of registered clubs will be affected by tax increases About 1000 registered clubs will be hit hard.

The hardest hit will be the clubs that “employ the bulk of people who work in our industry. The club movement across NSW is the third largest employer in the state”, ClubsNSW stated.