An inquiry into gambling announced yesterday by Internal Affairs Minister Peter Dunne may be the first step towards tougher regulation and control of online gambling.

Mr Dunne announced yesterday that the Government was to review the 2003 Gambling Act.

It would particularly focus on gaming machines or “pokies” (so-called “class four” gambling)

 Mr Dunne said their operation in non-casino environments was not a commercial venture but a philanthropic one.

About $620 million was distributed for community purposes from gambling proceeds in 2013/14.

 Of that, class 4 provided about 40 per cent.

“The government is well aware of the significant funding stream provided by gambling, and by class 4 gambling in particular,” he said.

“I want to maintain a sustainable funding stream for good causes delivered by trusted and reputable operators.”

He said that the number of gaming machines has steadily declined since the Gambling Act was passed and consequently the levels of funding to the community from pokie gambling had dropped significantly in real terms since 2004.

“There are potentially a number of reasons for the decline – for example, the limitations on venues and machine numbers in the market since the Act was passed. 

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“There may be other contributing factors such as changing consumer preferences and behaviour. 

“I think it is also likely that new alcohol limits could also be playing a role.”

But Government sources say that the review is likely to find that the big cause is on line gambling.

Currently offshore online gambling is not regulated in New Zealand.

That means the gambling operators do not pay the 40% gambling machine tax paid by pokie operators in New Zealand.

Nor are they required to donate their profits to charities and sporting organisations.

And players are not subject to income tax nor are operator profits.

The Gambling Act states “it is not illegal for someone in New Zealand to participate in gambling over the Internet if that website is based overseas.”

Australia cracked down on online gambling in 2001.

Its Interactive Gambling Act is targeted at online gambling operators and makes it an offence for them to offer ‘real-money’ online interactive gambling to residents of Australia.

It also makes it illegal for online gambling operators to advertise ‘real-money’ interactive gambling services (such as online poker and casino) to Australian citizens.[3]

Accessing and using the interactive gambling services is not an offence.

 It is also allowed to companies based in Australia to offer their gambling services to gamblers located outside Australia with the exception of those countries that were called ‘designated countries’.

 A country can be called designated upon request of the government of this country and on condition that there is corresponding legislation in that country.

Meantime Mr Dunne has also announced that the fees paid by gambling operators in New Zealand are to be increased.