Gambling levy rethink could deliver bigger community returns

Wednesday, 29 October 2025

Internal Affairs Minister Brooke van Velden has offered a concession in a bid to build community and parliamentary support for a law change that would bring online casinos into the mainstream.

However, the move has not been sufficient to win over one of its most influential critics.

The Government previously proposed licensing up to 15 online casinos and allowing them for the first time to legally advertise their services in New Zealand.

However, as well as attracting criticism from organisations concerned with reducing gambling harm, the Online Casino Gambling Bill also ran into stiff opposition from community groups that rely on revenue from other forms of gambling.

Dozens of social and sporting associations appeared in front of Parliament’s Governance and Administration select committee last month to voice concerns that online casino gambling would eat into the proceeds they receive from levies on pokies.

Van Velden responded today by proposing they also get a cut of the proceeds from online casinos.

Since June last year, online casinos have notionally been obliged to pay a 12% levy to the Crown on their net proceeds from gambling.

But van Velden has now proposed the levy be increased to 16% with the switch to a licensed regime, with community groups getting the additional 4% cut.

“The message from communities was loud and clear – if we're regulating online gambling, they want to see benefits flow back to local sports clubs, community groups, and grassroots organisations,” van Velden said.

“I have listened, and now as a Government, we are delivering on what matters most to communities across the country.”

Pub Charity managing director Martin Cheer — who appeared to make a strong impression on the select committee last month in his opposition to the bill — described the concession as a token gesture.

“It's typical of a political concession designed to buy acceptance when the ‘value proposition’ is suspect,” he said.

It did not represent good value given an average of 44% of the proceeds from pokies went back to the community, he said.

Some organisations that raised objections with the select committee about the Online Casino Gambling Bill would feel like it was an achievement “because it’s 4% more than what was proposed”, he predicted.

“For those that have got a calculator and can do the maths, it’s a still a poor deal.”

Cheer said online casinos that were paying the 12% levy at present were doing so essentially voluntarily, given they were based overseas, in the expectation that might help them secure a licence and legally advertise in New Zealand as and when the regulated regime came into effect.

“The real thing that they're pursuing is the ability to market.”

Van Velden has said the “number one objective” of the Online Casino Gambling Bill is to protect people from gambling harm, rather than to raise revenue for the Crown.

Bringing online casinos under New Zealand law would enable “proper consumer protections, harm minimisation measures and — now – community benefits”, she said.

Cheer said that given the “horrors” online casinos created, the best option would simply be to follow the example set by countries such as India and make it as difficult as possible for Kiwis to access such sites.

“We’re in exactly the same place as when we were contemplating allowing vapes to be sold commercially and available to the general public,” he told The Post.

“The thought was they would help some smokers who were struggling to give up tobacco. But what they did was introduce nicotine to a new generation and create a whole new market for a dangerous product. This has the same feel.”

The Online Casino Gambling Bill has been treated as conscience vote in Parliament, meaning it is accepted MPs can vote on it according to their personal beliefs, rather than being obligated by their party's formal stance.