Higher costs associated with Australia’s Point of Consumption Tax (POCT) has ultimately been passed over to gamblers, according to a note from JP Morgan on Wednesday.
While the intent of the POCT was to tax corporate bookmakers, JP Morgan says round pricing indicates that POCT pricing has been passed along to the gambler, which will ultimately reduce turnover.
“We maintain our view that gamblers, not corporates are paying for POCT; a catalyst for reduced industry turnover,” said the brokerage.
“Short term, price increases can garner better wagering margins, albeit at the cost of overall turnover. The impact of decreased turnover, especially for horse/harness/greyhounds is concerning when prices increase and gamblers lose wallet quicker,” added the brokerage.