Monique Ryan (Kooyong, Independent) Share this | Hansard source

Tax incentives for research and development activities are designed to back businesses to test new ideas and to innovate. These concessions encourage investment, help Australian companies to compete internationally and foster the kind of innovation that drives much-needed productivity growth throughout our economy. At their best, R&D incentives support breakthroughs—in medicine, technology and advanced manufacturing—that can improve lives and strengthen our national capacity. As a medical researcher, I know the value of research and development, particularly R&D that improves the health and wellbeing of all Australians. That's what research and development should do, but supporting innovation should never be confused with subsidising harm. Taxpayer dollars should not ever be used to promote industries or activities that exacerbate addiction, create public harm and pose serious health risks.

The Australian Taxation Office's R&D tax incentive transparency report 2021-22, published in October 2024, revealed the scale of R&D support received by an industry whose products and services cause significant harm—the gambling industry. In 2021-2022, slot machine makers Aristocrat and Ainsworth claimed $22 million and $15 million in R&D expenses, respectively. PointsBet, BetTube and Betting Technologies Australia all claimed more than $1 million, and Tabcorp claimed nearly $40 million. In 2022-2023, that grew to nearly $44 million. So, under our R&D tax incentives, these predatory gambling companies are being permitted—encouraged, even—to deduct at least 38.5c for every dollar that they spend on eligible activities. That's a pretty substantial incentive.

In a cost-of-living crisis, with Australia's gross debt at about $1 trillion, we have to ask ourselves why the government is subsidising predatory industries which are causing harm to Australians. Why are we, as a country, supporting the gambling industry to develop ever more sophisticated tactics to target our young people and to cause them harm through more harmful products and more effective ways to keep people addicted to gambling? Because that's what R&D in the gambling industry aims to do. It aims to increase engagement, to increase losses and, as a direct result, to increase harm.

This is why, in the 2024-2025 Mid-Year Economic and Fiscal Outlook, the government announced that activities relating to gambling and to tobacco would be excluded from R&D tax incentive eligibility after 1 July 2025. Schedule 4 of this bill delivers on that commitment. Specifically, it amends the Income Tax Assessment Act 1997 to exclude activities related to gambling services, gambling and gambling-like practices and activities related to tobacco, nicotine products and vaping goods. That exclusion extends also to nicotine products to capture new and emerging nicotine devices. However, the legislation still provides for a narrow exemption. Where activities are solely for the purpose of harm reduction, such as reducing addiction, these activities remain eligible to receive support. It is my position that this exemption should be removed.

There's no reason why taxpayers should be subsidising research and development that exacerbates serious health risks, addiction and associated harms. In developing these reforms, the Treasurer himself conceded that it is problematic that gambling companies are still receiving these incentives. That is a pretty significant admission from a government which has, for far too long, looked the other way when it comes to this country's addiction to gambling.

If we are acknowledging the harm caused by gambling, and we are legislating the removal of subsidies to the industry, why is the government still refusing to act on gambling advertising? Advertising works to normalise gambling behaviour. It is constant, it is pervasive and it is designed to influence. Every TV ad, every online promotion and every push notification from a betting app on a young person's phone reinforces the harm that this legislation purports to seek to reduce. The public health evidence is clear. Gambling advertising increases participation. Gambling advertising encourages risk-taking. Gambling advertising normalises betting as entertainment, particularly for young Australians. If the government is actually serious about coherent evidence based reform, it shouldn't be stopping at R&D subsidies. It should urgently confront the harms of gambling head-on. Not doing so is virtue-signalling without substance—words without weight from the Albanese government.

The gambling industry has long had a powerful lobbying influence in Australia. It seeks to shape policy and it seeks to protect its profits. Its reach extends into political donations, sponsorships and lobbying activity—tools that continue to influence government decision-making at the very highest levels. Gambling related industries have made more than $80 million in political donations over the last two decades alone. In 2023-24, gambling companies donated $1.5 million to political parties. Most of that went to the Australian Labor Party. It's been more than a thousand days now since the Murphy report into gambling harm was released, and the government is still to act, still to adopt even one of the report's 31 recommendations. If anyone is wondering why, let me be clear: the influence of the gambling industry over the government is the reason. Gambling is not just a public health issue; it's a deeply entrenched political lobbying issue.

So, while I support this legislation, this is what the government should do: the government should immediately ensure that all regulatory loopholes open to the predatory gambling industry are firmly and immediately closed; the government should act immediately to address the profound health and financial harms caused by the toxic gambling industry by demonstrating, through its legislative actions, that gambling is a public health crisis that Australians can no longer afford; and the government should immediately implement the 31 reforms recommended by the Murphy report into gambling harm, starting with its cornerstone proposal for a comprehensive phased ban on all online gambling advertising.

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