Punters are voting with their feet and their wallets, and Queensland racing is slipping fast.
Higher taxes mean fewer offers, worse odds, smaller markets and less reason to bet on Queensland racing. When turnover drops, everyone feels it. Punters lose value, owners lose prizemoney and the sport loses relevance.
Queensland racing is in crisis mode, and the alarm bells are ringing loudly.
Wagering Service Providers (WSPs) were banking on common sense tax reform from the McGrath Review. It did not come. Publicly they are polite, privately they are furious. They see a government ignoring hard economic facts while they hold the keys to the wagering future. If they are forced to choose which jurisdictions they support, Queensland will not win that battle.
The independent McGrath Review warned of a dangerous downturn in wagering on Queensland racing. It also handed the State Government the first part of the solution to reverse the decline. It was sitting right there in black and white, and it was ignored.
The report was brutally clear.
“While wagering markets have softened nationally, the sharp decline in Queensland turnover was viewed as disproportionately severe, reflecting deeper structural issues that require urgent reform.”
Racing Queensland’s financial future is tied directly to wagering turnover. The ability to fund prizemoney, maintain facilities and support participation statewide is under threat. Everything the industry is built on is wobbling.
The catalyst is tax policy.
The Point of Consumption Tax (PoCT) was pushed from 15 percent to 20 percent and the results have been immediate and ruthless. In FY25, turnover on Queensland racing fell 9.7 percent. In FY24 it fell 8.3 percent, the exact period those tax settings changed.
At the same time, Queensland’s national market share fell from 17.4 percent to 16.6 percent in a single year. Punters are choosing to bet elsewhere.
WSPs have responded logically to the 20 percent PoCT by prioritising jurisdictions where the economics work. That impacts Queensland’s market percentages and it impacts the promotional spend that powers turnover.
Sportsbet CEO Barni Evans has been publicly scathing of the decision. They hold the keys to more customers than anyone else in the Australian market and his view is echoed across the industry.
Entain were diplomatic in their public comments but referenced the rise of black markets, suggesting they would play a “role in protecting Queenslanders from operators who pay no tax and offer no consumer safeguards”. A subtle dig at one of the unintended consequences of increasing PoCT: a rise on offshore gambling.
READ – The offshore drain: Racing is walking into a funding crisis
Racing Queensland’s interim CEO Lachlan Murray rightly points to adjustments made to Race Fields fees to help offset the PoCT increase.
“At the time POCT was increased to 20 percent in 2022 a significant adjustment was made to Queensland Race Field fees which saw the rates being reduced to be the most competitive in the country.”
Murray was considered in his comments on the Government’s tax stance.
“Whilst RQ does not set PoCT policy or rates, at the time PoCT was increased to 20 percent in 2022 a significant adjustment was made to Queensland Race Field fees which saw the rates being reduced to be the most competitive in the country.”
WSPs believe the solution was obvious and the decision to ignore it is reckless.
The view is that the Government is playing a dangerous political game with the long-term future of Queensland racing.
This is a real-world case study in the Laffer Curve. Raise taxes to the point that demand collapses and total revenue falls. The State Government thought it was boosting its return. Instead, it is starving both itself and the racing industry of the turnover that funds the entire ecosystem.
And here is the most frustrating part. The review provided the answer.
“Recommendation 40: reduce PoCT from 20 percent to 15 percent.”
The fix stared the Government in the face. One of only five recommendations out of 110 that were rejected.
Meanwhile Queensland is in an arms race. It already struggles to compete with Victoria and New South Wales for elite equine talent, major events and wagering attention, but it had always held a buffer over South Australia and Western Australia in visibility and product attractiveness. That advantage is shrinking rapidly.
If Queensland does not correct course, it risks being overtaken by the very states it once outran. In a crowded national marketplace, the racing that attracts the wagering gets the prizemoney. The prizemoney brings the horses. The horses bring the punters. Queensland is willingly weakening its own position in that chain.
Government representatives point to significant infrastructure funding as proof of commitment to the industry. Improving tracks, training facilities and racing amenities is important, but infrastructure does not grow wagering, it does not create recurring revenue.
Once that money is spent it is gone forever. Without a strong wagering engine, the new buildings will be little more than monuments to mismanagement.
It is an illusion. Government grants deliver a sugar hit while current tax policy quietly hollows out the commercial core.
Look at tobacco for a cautionary tale. Push tax levels into the unsustainable and illegal activity rises while revenue ultimately falls.
This is the moment to act. The first step has already been identified. Reduce the PoCT. Stimulate turnover. Restore confidence among wagering operators. Secure the future.
The alternative is likely continued decline. Revenue collapses. Racedays disappear. Clubs shut down. Entire regions lose their racing footprint. Once that process begins, it can take a generation to recover. If recovery even comes at all.
Queensland racing is approaching a tipping point. Right now, the Government is pushing in the wrong direction.
