By Kieran Adair
NSW Opposition leader Luke Foley won the ALP rare praise in the Daily Telegraph last week, promising a $339 million tax cut for the racing industry if elected this March. The move has been opposed by critics who accuse Mr Foley of playing populist.
The announcement follows recommendations made by a Legislative Council select committee into greyhound racing, which suggested a staggered reduction in taxation rates on wagering to bring NSW racing in line with other states.
Under Mr Foley’s plan the tax on every $100 wagered in NSW would be cut from $3.22, the highest in the country, to the Victorian rate of $1.28, the lowest.
Mr Foley said Labor’s plan will generate “thousands of jobs created in the racing industry – and more importantly will support the 50,000 currently employed in our industry.”
However a PricewaterhouseCoopers (PWC) analysis of these changes, published as part of the select committee hearings, has already thrown these claims into doubt.
According to the PWC modelling, new job growth in the racing industry would come at the expense of jobs in other areas of the economy. Any initial boost would be offset in the long-run as the cuts draw resources away from other industries across the state. The Opposition is yet to announce where it plans to find the additional $339 million of revenue needed to finance the cuts.
It is these economic concerns that have caused the Liberals to withhold their endorsement of the plan. However, the move is also likely to hurt Labor’s vote in the historically progressive Inner City seats of Balmain, Sydney and Newtown, where the party hopes to compete this March.
The current Member for Sydney, Alex Greenwich, expressed his disappointment at the proposal, and told City Hub the move was not good policy.
“It is irresponsible to give tax breaks to bolster an industry… which thrives on financial loss while contributing little to the community,” he said.
During the select committee hearings Mr Greenwich said he was contacted by hundreds of constituents, who raised concerns about the racing industry’s poor treatment of horses and greyhounds. He argues the funds would be better spent on services and infrastructure such as health, education and public transport.
Jamie Parker, the current Member for Balmain said, “of all the issues Labors’ new leader could address, his first commitment was handing hundreds of millions to the racing and gambling industry. Voters want their representatives to stand up to powerful lobby groups like gambling, racing and developers and not appease them by gifting them hundreds of millions of dollars.”
The proposed changes have also drawn the attention of prominent anti-gambling campaigner Reverend Tim Costello, chief of World Vision Australia, who says gambling is already out of control in NSW.
‘One way of at least bringing back some benefits from this complete loss of control is taxation,’ he told Australian Associated Press.
‘It places a cap on gambling, discourages it and returns some benefits to the community. The public good is not served by cutting gambling taxes.’
While Mr Foley has downplayed Rev Costello’s criticism, arguing that the racing industry already invests in programs to address problem gambling, he has yet to respond to the economic and ethical concerns outlined by his detractors.
The NSW Greyhound Breeders, Owners and Trainers’ Association, operators of Wentworth Park Greyhounds, were approached for comment.