Casino winnings to fall into the tax net soon

2012-02-23 00:00

FOR a long time casino gamblers in South Africa have evaded the taxman’s grip.

However, after Finance Minister Pravin Gordhan’s budget speech yesterday their taxless days might be numbered.

He said his department proposed that a national tax, based on gross gambling revenue from casinos, should be introduced.

This followed the 2011 budget proposal on gambling, when he suggested that all gambling winnings above R25 000 would be subjected to a 15% tax.

Gordhan said the new tax should be effective from April 1 of next year.

He said this tax would take the form of an additional one percent national levy across all provinces in this industry.

Gordhan said: “A similar tax base will be used to tax the National Lottery.”

South African Revenue Services (SARS) spokesperson Adrian Lackay confirmed to The Witness last night that the proposed tax was targeting casinos.

He said that at this stage the matter is still a proposal.

“It will still form part of a draft bill that will be tabled in Parliament and will have to be debated by the public,” said Lackay.

The Casino Association of South Africa’s CEO Derek Auret said the proposed tax would have a negative impact on the industry.

“It’ll affect the gambling industry, of course. Taxes in this industry are problematic. Also, this will have an impact on job creation. I don’t think it’s necessary,” he said.

He added that the tax would also have a negative impact on income generated by provincial governments through this industry.

Ndabe Sibiya, spokesperson for KwaZulu-Natal Premier Zweli Mkhize, said the premier would engage with the new gambling board and study Gordhan’s speech.

He said that Mkhize and the recently-formed board would ensure proper alignment with the national government on Gordhan’s proposed tax. “If there are questions we’ll seek clarity and we’ll have ongoing interaction with the minister [Gordhan],” Sibiya said.

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