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Thursday, 14 June 1984
Page: 3008

Senator COLSTON(12.48) —On 3 May I asked a question without notice in relation to the use of in-line amusement machines which are being used for illegal gambling in Queensland. My question was not directed at the illegal gambling which is a responsibility of Queensland State Government authorities; rather, it was directed at the alleged tax evasion by the promoters of these machines. My question read as follows:

My question, which is directed to the Minister representing the Treasurer, relates to publicity about in-line amusement machines being used for illegal gambling in Queensland. Does this illegal but apparently officially condoned gambling involve a cash business with a turnover of several million dollars a year? Has the Australian Taxation Office investigated whether tax is being avoided by the promoters of these machines? If not, will the Taxation Office undertake the necessary investigations to determine whether taxation is being avoided by those associated with the machines?

Senator Walsh, the Minister representing the Treasurer, replied to my question as follows:

I have a note from the Treasurer about this matter in which I am told that he is unable-and therefore I am unable-to confirm whether there is an illegal, but officially condoned, gambling industry in Queensland, as Senator Colston suggests or believes. The Commissioner for Taxation has advised that he is unaware of any particular gambling activities involving amusement machines in Queensland, which may also be associated with tax avoidance. As a general rule, the Commissioner seeks to ensure that tax legally payable in relation to any activity is paid. If the honourable senator has any detailed information regarding allegations that tax is being evaded or avoided, the Commissioner will , of course, be pleased to receive such information. I add that I will be very happy to pass on to the Treasurer a request that he sees that the matter is investigated promptly, particularly if Senator Colston can supply some more specific information such as particular locations and activities.

I first comment on the suggestion that I supply some specific information such as particular locations and activities. This seems hardly necessary. Any person in Queensland who has read the newspapers or watched television news over the past few months would know that the in-line amusement machines are being used in clubs throughout the State. They are as much a form of gambling as poker machines and, although illegal under Queensland law, are allowed to flourish almost unhindered. Tax officers in Queensland would not need to be provided with particular locations. They have only to walk into clubs in Queensland to see the in-line machines in operation.

I am not sure what the Minister meant by activities. However, it is generally known that the promoters of these machines take a large percentage of the profits. The net profits made by the clubs are shown in their annual reports, but to my knowledge there is no record of commissions paid out to the promoters. Information I have received suggests that $3m is paid out annually to the promoters and no records are held of that $3m. If tax is being paid on that money, I would be surprised. The evidence to support what I have said is available in clubs' annual reports. Those reports outline what the clubs receive from their in-line machine operations.

The answer which I received in reply to my question of 3 May was, at best, evasive. I do not attach any blame to the Minister for the supply of an answer which denied any knowledge of what is going on in Queensland. I do, however, blame the public servants who provided the information for the answer. The whole matter surrounding the amusements machines and the condoning of what is illegal gambling smells of corruption in Queensland. If the Australian Taxation Office does not follow up what could be significant tax evasion or avoidance in Queensland, the conclusion which will inevitably be drawn is that someone in that office is also on the take. I do not believe that this would happen in our Taxation Office, but to show its bona fides, some work in this area is obviously necessary.