December 24th, 2018 | Updated on April 13th, 2023
New studies have unveiled that the level of community, as well as charitable distributions, provided by operators of pokies machines( including Microgaming slots), is quite minuscule when compared to the number of funds lost by the users of these machines within the local communities.
One of the claims that clubs of pokies machines in Australia have made is significant charitable donations. In most instances, this is signified by the support which these pokies clubs provide to an array of charities or junior football teams.
In New South Wales (the state which contains the highest number of pokies machines) for instance, there are claims that peak body clubs NSW has distributed AUD 93 million worth of grants within the last year. However, as a percentage rate of total pokies machine revenue, it exudes modesty, since AUD 93 million only accounts for 1.7%.
In the year 2012, a discovery was made that contribution level of pokies clubs to the community was astronomically low in comparison to the total revenue earned. It varied from 1.4% in New South Wales to 6.7% in the Australian Capital.
Among the challenges noted in 2012 was that the actual revenue generated from pokies machines is not publicly unveiled in Queensland alongside New South Wales, yet in Victoria, for example, this data was made public. The gap in the availability of this data makes it challenging to determine the exact amount that pokies clubs actually donate to the community in comparison to what they make from the same community in terms of losses incurred when people use pokies machines.
In Victoria, Pokies clubs have an obligation to submit a community or donation benefit statement every year which should depict that they have not donated less than 8.2% of the earnings acquired from pokies. Those who fail to abide by this rule get an automatic deduction of the same percentage in the form of taxation.
Upon the introduction of the GST, the taxes on pokies machines were astronomically lowered. It was later discovered that the donations to what a myriad of people would consider as genuine community benefits were the absolute minimum. The category is inclusive of charitable alongside philanthropic purposes, not to mention gifts which were awarded to the community organizations. Among all pokies clubs which were located in Victoria, the donations benefit statement claims came to a total of AUD 273.7 million as of 2013. From this share, only 6.9% (AUD 18.6 million) was awarded in the form of gifts, sponsorships, and donations. In contrast, AUD 209.5 million (77.5%) of the claims became wages, insurances, management expenses, and superannuation.
As a share of the total losses incurred by the pokies club (AUD 847 million), the sponsorship, gifts, and donations came to 2.3%. An examination of three primary Victorian AFL clubs (Geelong, Carlton, and Collingwood) which are in charge of operations of several wagering venues was conducted. In a report of 2013, Carlton claimed to have donated over AUD 1 million to sports facilities from the 4 pokies venues that it is in charge of, which all went to its famous training base (Ikon Park) for the top AFL footballers located in Melbourne.
As of 2014, there were no such claims which were made. Carlton instead made claims of contributing almost AUD 1.4 million to Ikon Park. These were considered as gifts, sponsorships, and donations, as opposed to the subsidies of sports.
Nevertheless, these amounts contributed towards the same objective; one which arguably does not provide any advantage to those residing in the outer suburbs where their pokies clubs are situated.
Collingwood made claims that sponsorships, donations, and gifts of AUD 190,000 from its two pokies club venues as of 2014. The overwhelming high percentage of its donation benefits statement depicts that over AUD 1.7 million was the operational expenditure of superannuation, wages and more.
Geelong is in charge of two pokies club venues. As of 2014, it claimed sponsorship amounting to AUD 110,000. Most of its claims were operational costs (AUD 1.6 million) of the pokies venue, 94% of the total.
What Now?
It is evident that claims which pokies clubs make that they provide substantial donations to the community are evidently overstated. More significant benefits may be provided through the application of extra tax, acquired from hotel venues. For example, in Victoria, this would at least 8.4% (AUD 71 million) annually, in addition to imposing a corporate tax on wagering revenues, more so in the instance of large clubs like the ones of New South Wales.
All in all, it is quite evident that some pokies clubs do offer genuine donations to their communities. It is unfortunate that these clubs have developed major dependency of approximately 65% of the total revenue. Some pokies clubs representatives have attempted to gild the lily when making their claims of providing community support, with the fear of the consequences of fairer taxation, or regulations to minimize harm which are efficient.
