The New Zealand Inland Revenue Department has provided its own estimates regarding the government’s plan to increase revenue from online gambling, which are significantly lower than what was anticipated by the National Party before the election.
According to The New Zealand Herald, while National projected annual revenue of approximately NZ$176 million by closing tax loopholes for online gambling, the Inland Revenue Department (IRD) expects only NZ$35 million ($21.5 million) annually, gradually increasing to about NZ$155 million ($95.2 million) over four years.
This discrepancy of over NZ$500 million ($307.3 million) over the forecast period highlights a significant difference in revenue expectations between National’s pre-election projections and IRD’s assessments.
Finance Minister Nicola Willis acknowledged that the figures were lower than anticipated but noted that the government is considering implementing a new regulatory regime for online gambling, which could potentially generate NZ$118.6 million in revenue over the forecast period, narrowing the gap between National’s forecast and IRD’s estimates.
National’s campaign focused on better regulating offshore online gambling to align it with in-person gambling, potentially resulting in increased tax revenue. The proposed regulatory regime included measures such as requiring online casino operators to register and report earnings for tax purposes and implementing IP ‘geoblocking’ for non-compliant services. The preferred option among officials was a flat 12 percent duty.
Despite the lower revenue estimates, Willis expressed confidence in the scheme, emphasizing the need to address the unregulated nature of online gambling. She maintained that establishing a regulatory regime was essential, even if the revenue generated might not meet initial expectations.
