NSW Wants to Raise Your Betting Tax to 20% – Here Is What Every Punter Needs to Know

New South Wales is the largest wagering market in Australia, and the taxes applied to online betting generate hundreds of millions of dollars for state coffers each year. For wagering operators, understanding the Point of Consumption Tax (POCT) regime is essential for compliance and financial planning.

The current wagering tax rate in NSW is 15%, applied to a betting operator’s net NSW wagering revenue that exceeds the annual threshold of $1 million. This rate has been in effect since 1 July 2022, when it was increased from the original 10% introduced in January 2019.

This guide explains NSW’s wagering tax rates, calculation methods, revenue figures, and proposed reforms to increase the tax to 20%.

Current Wagering Tax Rate – 15% POCT

New South Wales introduced the Point of Consumption Tax (POCT) on 1 January 2019 under Part 4 of the Betting Tax Act 2001. The POCT is a tax on wagering revenue generated from bets placed by NSW residents, regardless of where the betting operator is physically located.

The tax rate has increased twice. Initially set at 10% in January 2019, the rate rose to 15% on 1 July 2022, where it currently remains. This 15% rate applies to all wagering operators active in NSW, including Sportsbet, TAB, Bet365, Ladbrokes, and others.

Only wagering operators whose net NSW wagering revenue exceeds $1 million for a financial year are liable to pay POCT. Smaller operators or those with limited NSW exposure may fall below this threshold and have no tax liability.

The POCT regime is designed to ensure that all wagering operators contributing to the NSW market pay tax on a level playing field, regardless of where they are licensed. This prevents operators from basing themselves in lower-tax jurisdictions to avoid paying NSW tax on bets placed by NSW residents.

Official sources:

• NSW Government POCT guidance: https://www.nsw.gov.au/betting-tax
• Betting Tax Act 2001 (NSW): https://legislation.nsw.gov.au/act-2001-043

NSW POCT Rate History

How POCT Is Calculated – The Tax-Free Threshold and Free Bets

The calculation of POCT liability is based on the operator’s “net NSW wagering revenue” for a financial year. The Betting Tax Act 2001 (Section 13A) outlines a specific formula for this calculation.

Net NSW wagering revenue is calculated as the sum of all NSW bets (including the face value of free bets), plus total fees and commissions associated with making the bets, minus total winnings paid or payable and total refunds paid.

A key point for operators to note is that free bets are included in the calculation. The full face value of any free bet offered must be included when calculating net NSW wagering revenue, not just the amount actually staked. Free bets cannot be deducted from gross revenue.

The calculation uses a “money in, money out” basis based on the operator’s ledgers. Bets, fees, and commissions are summed based on when the bet is placed. Winnings and refunds are deducted when they are paid or payable, and they do not need to correspond to the same bets placed in a period.

Liquor & Gaming NSW (L&GNSW) has commenced an audit campaign on betting service providers to ensure compliance with the Betting Tax Act. The audit examines correct registration, accurate POCT calculation (including free bets), timely returns lodgement, payment compliance, and proper customer location identification.

Operators must also calculate POCT on a monthly basis after a qualifying month and complete an annual reconciliation for each financial year.

Official source: https://www.nsw.gov.au/poct-calculation

Wagering Tax Revenue – Billions for the NSW Budget

Professor Sally Gainsbury has warned that state reliance on gambling taxation is regressive, as losses are disproportionately borne by those least able to afford them. She questions how governments can invest in harm reduction when gambling proceeds build their budgets.

Official source: https://agbrief.com/nsw-gambling-revenue

NSW POCT Revenue Projections

Proposed Reforms – The Push to Raise POCT to 20%

In June 2024, Tabcorp formally proposed raising NSW’s POCT from 15% to 20% to align with Queensland and the ACT. The government established a consultation process, inviting submissions from wagering operators and racing bodies.

However, neither the racing industry nor Tabcorp reportedly want the increase. They argue wagering taxation has already reached its limit. An increase would likely lead to higher costs for punters, as operators may reduce odds or pass the tax burden onto consumers. The pool of money available for distribution to racing under existing funding agreements would also shrink.

Treasurer Daniel Mookhey has stated that change will only happen if it is clear that the public will be better off. As of April 2026, the relevant authorities have made no final decision. Any change would require amendments to the Betting Tax Act 2001 (NSW).

Official source: https://www.nsw.gov.au/wagering-reforms

New South Wales operates a 15% Point of Consumption Tax on wagering revenue exceeding $1 million, a rate that has been in place since July 2022. The tax base includes free bets, and operators must calculate and lodge returns monthly with annual reconciliations. POCT revenue has consistently fallen short of government projections, with revised forecasts showing significant downward adjustments.

The government is currently considering a proposal to raise the rate to 20% to align with Queensland and the ACT, though industry concerns about the impact on racing funding and punter odds remain unresolved. For now, the 15% rate remains in effect, subject to ongoing review.

Sources: NSW Government, Betting Tax Act 2001 (NSW), NSW Budget Papers, AGBrief, The Straight, Liquor & Gaming NSW