Tag: Financial Management

From Tin Shed to Taj Mahal — Scale and Contrast in 1963

In 1963, Penrith and St George Rugby League Clubs each opened new premises. The contrast between them — in scale, cost, and ambition — highlights the gap between an emerging club and one already established as a powerhouse of the game.

To describe Penrith Rugby League Club as a minnow compared to St George Rugby League Club in the early 1960s is no exaggeration.

In 1963, the St George Dragons had already secured seven consecutive premierships, a run that would extend to eleven.

In 1963, both clubs opened new premises.

In March, Penrith Leagues Club opened a new building adjacent to the old Boys Club, at a cost of approximately £150,000.

Official Opening Program PRLC 1963

In July, St George Leagues Club opened its new premises at Kogarah, with construction costs approaching £1,000,000.

William “Bill” Buckley (1906–1973), Chairman of the Australian Rugby League, officially opened both clubs. During a tour of the new St George premises, struck by its scale and extensive use of marble, he is said to have remarked: “This reminds me very much of the Taj Mahal.”

The nickname endured.

St George Leagues Club — Photo: Joan Hatton

Both developments marked a move beyond earlier, more modest beginnings — the kinds of facilities often remembered, and sometimes simplified, as the “tin shed” era.

For St George, that transition had already occurred.

For Penrith, it was only just beginning.

The scale of the St George club did more than impress. It set a benchmark — one that emerging clubs like Penrith could not yet match, but would, over time, seek to close.

From the Narrative

This contrast sits alongside the developments described in Part 4 — From Small Beginnings, where Penrith’s early structures begin to take shape against a backdrop of more established clubs.

A Little Extra

Here is the complete 1963 Opening Program for Penrith Rugby League Club — it was a big day, starting with lunch, then evening and supper — and lots of dancing! And plaudits to the Penrith Rugby League Orchestra who must have exhausted by night’s end.

PRLC Official Opening 1963

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Financial Management

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The Impact of a Turnover Tax

A turnover tax on gambling is a tax imposed on the total amount of money wagered or “turned over” in a gambling activity, rather than on the profits generated by the gambling operators.

For example, imagine you take $100 to the races, and you place a $100 on the first race, it wins and you now have $350. You continue to bet $50 on each of the 7 remaining races. So, if you add up the amount you bet it comes to $450 – your first bet of $100 plus 7 bets of $50.

A turnover tax on this activity means the tax is calculated on the total value of the the bets placed, $450. Yet, the amount spent by the punter was only $100.

This example shows the very best result for the betting provider would be for the punter to finish the day broke – and the provider would have a revenue of $100. But they would be paying tax on $450.

Of course, it would be possible for the provider to lose hundreds of dollars to this punter, yet still pay tax on the $450 turned over.

Industry opponents of turnover taxation argued that the structure materially reduced operators’ capacity to improve return-to-player rates.

The mathematics of a turnover tax make it extremely restrictive – and, in fact, for some gambling games (like blackjack) even a small turnover tax would mean the game would not be viable.

For example, poker machines in NSW have a minimum return to player rate of 87%.

At a theoretical level this means a couple of things:

  • Firstly, it means the theoretical revenue for the operator is 13% – that is the operator can expect to retain $13 in every $100 staked on their games.
  • Secondly, it means the theoretical turnover for the player is 3.42 times their orginal stake. So, starting $100 and playing until depleted will generate a theoretical turnover of $342.

In the case of a starting stake of $100, theoretically the operator will retain $13. If a 3% turnover tax is applied their obligation to the tax office will be 3% of $342, which is $10.25.

Now, imagine an operator wants to offer a better deal to their patrons with a 90% return to player. So $100 stake produces a theoretical $10 revenue for the operator. The turnover is $388 and a 3% turnover tax will produce a tax obligation of $11.74 – so the tax office will take all the operator’s revenue plus more.

Critics maintained that turnover taxation limited pricing flexibility and distorted game viability.

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