Governments all over the world are notorious for their inability to move in front of the times and are usually slow into stride even when it comes to moving in response to change. The pace of change in Internet gambling has left political bodies everywhere struggling for pace, as we have seen with the slow progress of legislative changes in Hong Kong. The state Government in New South Wales, Australia, offers as good an example as any of just how clueless governments can be with gambling's changing landscape. After years of racing media and industry haranguing for changes to the way that bookmakers are taxed so as to keep betting turnover local and doing something good for racing and the community, change has finally come too late. The Pacific island of Vanuatu had until recently been home to the biggest single bookmaking operation in the southern hemisphere, siphoning hundreds of millions of Australian dollars annually in phone betting. No amount of cajoling could convince the NSW Government to reduce tax on legal bookies. With the Vanuatu business now owned by a British betting firm, its base is being shifted to the pro-active Northern Territory of Australia. There bookmakers like Centrebet, Centreracing and Darwin All-Sports have been welcomed with open arms and friendly regulatory conditions and have redirected a great deal of betting turnover within Australia towards Darwin. The Northern Territory Government has made the place even more friendly to celebrate the arrival of the Vanuatu operation, slashing its tax on betting turnover to 0.33 per cent. Within 48 hours, the NSW Government finally moved to cut turnover tax, abolishing the one per cent state tax altogether. But the game was already over. The Northern Territory is becoming a focus for international betting operators, many offering fixed odds or tote odds-plus-rebate betting on Hong Kong racing. With close to nothing in the way of turnover tax to pay, they will have a competitive advantage in gaining customers from traditional sources. Will the Hong Kong Jockey Club also find itself getting legislative help only when the final whistle has been blown?