Pokies bid ‘driven by tax avoidance’

The Bendigo Club has applied to install 16 additional EGMs at the Park Street Venue.
The Bendigo Club has applied to install 16 additional EGMs at the Park Street Venue.

The City of Greater Bendigo is opposed to the Bendigo Club’s application to install 16 new poker machines at the Park Street Venue, claiming it is in part motivated by tax avoidance. 

In a submission to the state’s gambling regulator, which will hold a hearing in Melbourne on Wednesday to determine the application, the council suggests the economic and social impacts of the proposal would be detrimental to the community.

“There appears to be little demand for additional EGMs given the low usage rates of existing machines (at Bendigo Club). It appears the main motivation is to avoid tax. Tax avoidance is never a community benefit,” it states.

Related: Bendigo Club applies for 16 new poker machines

“The applicant argues that this will not cause disadvantage to the Bendigo community because the tax will be lost to the whole of Victoria. If every club adopted this approach the result would be significant.”

The council, through its submission, argued a significant amount of funding for Greater Bendigo’s development came from state and federal governments.

In its application to the Victorian Commission for Gambling and Liquor Regulation, Bendigo Club said increasing its machines from 44 to 60 would reduce tax payable by the club, given the calculation of gaming tax is on an expenditure per-machine basis. 

“If gaming revenue does not increase by as much as expected, expenditure per machine and hence tax payable will reduce. This saving goes straight to the bottom line for the club and allow the club to finance further improvements to the club,” the submission reads.

Council also said of the $477,750 in proposed infrastructure developments at the club, $143,890 of the works were either under construction or being purchased.

“The investment is considered to have a greater benefit for the applicant than the community,” the submission reads.

Related: Pokies' community benefits ‘a farce’

The Bendigo Club’s promotion of a Kids Club, and the exposure of children to EGMs, was also a concern for council.

Bendigo Club general manager Adrian McMahon said the club’s children activities were held in a separate function room away from the poker machines.

Economic modelling indicated the additional 16 machines could increase revenue by $835,000 per year, meaning the club could pay extra tax, he said.

The council, through its submission, was skeptical of this modelling.

The VCGLR in August refused Bendigo Stadium’s application to install 44 new poker machines at a White Hills hotel.

Bendigo Stadium has lodged an appeal with the Victorian Civil and Administrative Tribunal, but is currently weighing up the benefits of a likely expensive hearing, which would involve Bendigo council.