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Online Casino Law, Tax, Regulation in Australia

Many Australians have questions about how online gambling is treated under current laws. Are online casinos legal? Are taxes owed on winnings from online pokies? These questions and others can be confusing, and misunderstandings over the answers to them can cause people who would enjoy Internet pokies to stay away rather than join in the fun.

This page is designed to clear up any questions you might have about online casino law in Australia. While it is important to note that laws can change and that some minor differences can exist in state laws, the general concepts expressed here are accurate, and should help you better understand online casino laws in Australia.

Are Online Casinos Legal?

The short answer to this question is yes: it is legal for Australians to play on any online gambling site they choose! The longer answer is much more complicated, of course and begins with the passage of the Interactive Gambling Act in 2001.

The Interactive Gaming Act is the current law under which online gambling is regulated – or, perhaps more accurately, is not regulated – in Australia. Under that act, it is illegal for online gambling operators to offer most forms of online gambling to Australians. This is true whether the company is based in Australia or overseas.

However, the key point here is that it is not illegal for individuals to play on online gambling sites. Only the operators are impacted by this law; players are not engaging in criminal activity by playing online pokies or any other casino game. That means that the many overseas operators who allow their games to be played by Australians are violating laws here, but the players who join up with those same sites are not.

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How is Online Gambling Regulated in Australia?

The Interactive Gaming Act did allow for some forms of gambling to be licensed and regulated online. There are two major forms of gambling that you may be familiar with that are frequently licensed throughout Australia.

First, there are licensed sportsbooks that offer betting over the Internet in Australia. The regulations only provide that in-play betting is not allowed online, which is why Australian bookmakers only take bets after a game begins in person or via telephone (though there have been some attempts to work around this by sports betting sites in recent years).

In addition, lotteries throughout Australia are allowed to sell tickets online. Here, the only restriction is that “instant win” scratch off tickets cannot be sold online, as those would almost certainly qualify as “interactive” gambling in the vein of a true online casino. Not surprisingly, many online casinos offer such scratch card games themselves.

Do I Owe Taxes on my Online Gambling Winnings?

As with land-based gambling winnings, online gambling winnings are not taxed in Australia. The only “gambling taxes” in Australia are levied against operators rather than players.

The reasoning behind this is that gambling is not considered an occupation or profession, but rather a hobby. That means that any winnings are simply treated as the result of good luck, particularly in games where the house has an edge. In theory, full-time professional online poker players could potentially see their earnings considered income from their profession; however, in practice, this has not occurred, and there is nothing to suggest it will.

Are Changes Coming to Australian Online Gambling Regulations?

In September 2015, the federal government ordered a review of online gambling and the Interactive Gaming Act. In particular, the government said they wished to look at the impact of offshore online gambling sites on the regulated operations in Australia. According to social services minister Scott Morrison, about 60% of Australia’s online gambling industry is controlled by overseas operators, with more than 2,000 sites in total courting Australian customers.

Exactly what recommendations will be made by the review, which is led by former New South Wales premier Barry O’Farrell, are still unknown, though members of various gambling and sporting bodies will be consulted, and public input will also be accepted. Recommendations were expected to be presented to the government by the end of 2015.

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