Sports clubs accused of rorting tax concessionsJason Dowling
May 6, 2011SPORTING and social clubs - including AFL clubs - have been accused of continuing to rort tax concessions on their poker machines profits despite new rules that were supposed to have eliminated the abuse.
Clubs pay 8.33 per cent less tax on their poker machine takings than hotels in Victoria but must demonstrate in annual returns that they have provided community benefits equal to the tax concession.
An analysis of claims made by clubs last financial year by Monash University gambling expert Charles Livingstone shows 80 per cent of community benefit claims made by clubs were for operating expenses, financing costs and capital works. Operating costs include staff wages, venue management fees, electricity and rent costs and payments to players and officials.
Hawthorn Football Club's Vegas at Waverley Gardens venue claimed $1.16 million in operating costs and $464,643 in donations, gifts and sponsorship; Collingwood Football Club's The Coach and Horses venue at Ringwood claimed $1.15 million in operating costs and zero in donations gifts and sponsorship;
and Richmond Football Club's Wantirna Club claimed $938,954 in operating costs and zero in donations, gifts and sponsorship.
In 2007, the then gaming minister tried to tighten what clubs could claim as a community benefit by limiting operating cost claims.
But the first comprehensive analysis of club community benefit claims since the changes show the limit had little effect, with operating expenses making up the bulk of community benefits claimed by clubs.
''Donations and sponsorships and the provision of sporting facilities combined amounted to less than one fifth of the amount claimed by clubs for normal operating expenses,'' Dr Livingstone's report found.
''At the moment the classes of things they [clubs] are allowed to include and claim as benefits to the community is ridiculous and far too broad. I think you could describe it as a rort, I think it is a rort,'' Dr Livingstone told The Age.
He urged a new government investigation of club community benefit tax arrangements.
Attempts to tighten ''community benefit'' criteria are fiercely opposed by the clubs sector. Clubs Victoria executive director Richard Evans attacked Dr Livingstone's findings.
The report showed ''a lack of understanding to the community benefit clubs provide a community'', he said and firmly denied that clubs were rorting the system.
''Clubs exist for the benefit of the community and they raise funds for that club to provide services to the community and thus provide benefit such as employment,'' he said.
Mr Evans said there was no need to review what could be claimed as a community benefit. ''All staff employed at a club provide benefit for the community - greenkeepers, for instance, are employed by a club and thus have a direct benefit for the community,'' he said.
Minister for Gaming Michael O'Brien said the government ''supports community sporting and social clubs being able to use gaming revenue to support clubs in their activities''
http://www.theage.com.au/victoria/sports-clubs-accused-of-rorting-tax-concessions-20110505-1ea5b.html#ixzz1LVI2FvxL
