If you have ever fed a few coins into a gaming machine at your local pub or sports club, you have taken part in what New Zealand law calls Class 4 gambling. It is the most widespread form of commercial gambling in the country, yet most players never see how the system behind the screen works: who owns the machines, where the money goes, and why the stakes are capped so low. This guide explains the Class 4 sector in plain terms, including the rules set by the Gambling Act 2003, the role of the Department of Internal Affairs (DIA), and how pokies in pubs and clubs differ from the machines in a casino or the games on an online site.
Key Facts
- What it is: Non-casino gaming machines (pokies) in pubs, hotels and clubs, defined as Class 4 gambling under the Gambling Act 2003.
- Regulator: Department of Internal Affairs (DIA).
- Who owns the machines: Licensed societies (“pokie trusts”) or clubs, not the host venue.
- Machines and venues (Apr–Jun 2026): about 13,613 machines across roughly 948 venues.
- Player losses (year to June 2026): about $1.05 billion in gaming machine profit.
- Play limits: $2.50 maximum stake per play, $500 maximum single-play prize, $1,000 maximum linked jackpot.
- Community share: non-club societies must return at least 40% of proceeds to approved community causes.
What “Class 4” gambling actually means
New Zealand sorts gambling into four classes under the Gambling Act 2003, from low-risk raffles up to high-risk commercial activities. Class 4 is the top of that scale: it covers non-casino gaming machines, the devices almost everyone calls “pokies”. The Act specifically defines Class 4 as high-risk, high-turnover gambling, which is why it is the most tightly regulated form outside a casino.
In practice, Class 4 means the pokies you find in pubs, hotels, bars, Returned and Services Associations (RSAs), chartered clubs and sports clubs. It does not include casino gaming floors, which are licensed separately, and it does not include Lotto products or TAB racing and sports betting. It is also separate from the offshore and newly licensed online casino market, which is governed by its own 2026 rules; you can read more about that in our guide to New Zealand’s gambling laws.
The whole Class 4 system is overseen by the Department of Internal Affairs, which licenses operators and venues, sets technical standards for the machines, audits where the money goes, and investigates breaches.
Who owns the pokies: societies, venues and “pokie trusts”
A common misunderstanding is that the pub owns its pokies and keeps the takings. It usually does not. Under the Gambling Act, the machines are owned and operated by a licensed society, often a charitable trust that is commonly called a “pokie trust”. The pub or club simply hosts the machines as a licensed Class 4 venue and is paid a commission that is meant to cover its costs of hosting, not to generate profit.
There are two broad arrangements:
- Non-club societies place machines in commercial venues such as pubs and bars. They must distribute most of the money to the wider community through grants.
- Clubs (for example an RSA, a cosmopolitan club or a sports club) run machines on their own premises, largely for their members and their own community purposes.
This separation of machine owner, venue and beneficiary is the defining feature of the model, and it is what makes Class 4 gambling in New Zealand a community-funding system rather than a straightforward private business.
How the money flows: turnover, GMP and community grants
Two terms matter here. Turnover is the total amount staked across all the spins. Gaming machine profit (GMP) is turnover minus the prizes paid back to players, so it is the money players actually lose and the figure the industry treats as its “profit”. GMP is the number the DIA reports each quarter.
The scale is large. In the year ending June 2026 the DIA recorded roughly $1.05 billion in gaming machine profit from Class 4 pokies nationwide, spread across about 948 venues and 13,613 machines as at the June 2026 quarter.
Once prizes are paid, GMP is divided between several fixed destinations: government duty and the problem-gambling levy, GST, the venue’s commission, the society’s own operating costs, and a legally required minimum share that must go to the community. Non-club societies that mainly hand out grants must return at least 40% of their proceeds to approved community causes, known in the Act as “authorised purposes”. Those purposes include amateur sport, education, health, the arts, rescue services and other charitable and non-commercial community work.
Where the Money Goes
| Destination | Approximate share of GMP | Notes |
|---|---|---|
| Community grants (authorised purposes) | At least 40% | Legal minimum for non-club societies; funds sport, charities and community groups |
| Gaming machine duty (government) | About 20% | Tax on gaming machine profit |
| Society operating costs | Up to about 19.5% | Running the machines, servicing and administration |
| Venue commission | Up to about 16% | Paid to the pub or club for hosting the machines |
| Problem-gambling levy | About 1.5% | Funds treatment and harm-reduction services |
Because so much of the money is earmarked for grants, the sector is sometimes described as “gambling for good causes”. That framing is real — community sport and charities receive hundreds of millions of dollars a year — but the money still comes from player losses, and the DIA has prosecuted cases where funds meant for grants were misused.
The rules that limit how you play
Class 4 pokies are deliberately held to much lower limits than casino machines. Under the Gambling (Harm Prevention and Minimisation) Regulations 2004, a pub or club machine must cap:
- the maximum stake at $2.50 for a single play;
- the maximum prize at $500 for a single play; and
- the maximum jackpot at $1,000 on machines that are linked together.
These caps exist to slow down how fast money can be lost, which is the main lever regulators have to reduce harm on high-turnover machines. Every machine must also meet DIA technical standards, display player-information messages and run on a random number generator, meaning each spin is independent and nothing you do changes the odds. If you want the detail on how a spin is actually decided, see our explainer on how pokies work, and for the realistic limits of “systems”, read what you can and cannot control on a pokie.
Where pokies can operate: councils, consents and the “sinking lid”
Opening a new Class 4 venue is not just a matter of getting a DIA licence. The Gambling Act gives local councils a say. Anyone wanting to establish a new pokie venue must first obtain the consent of the territorial authority (the city or district council) where the venue will sit.
Every council must have a Class 4 venue policy and review it at least every three years. Many have adopted a sinking lid policy: no new venues or machines are approved, and when a venue closes, its machines cannot be moved elsewhere, so the total gradually shrinks. That policy choice, together with declining demand, is why national machine and venue numbers have fallen steadily from their mid-2000s peak to the current figures.
Pub pokies compared with casinos and online play
The Class 4 model looks quite different from the other ways New Zealanders gamble on machines:
- Casino machines are not bound by the $2.50 stake or $500 prize caps and can run far larger jackpots. Casino gaming floors are also age-restricted to 20 and over. You can see how a large venue operates in our SkyCity Auckland review.
- Pub and club pokies sit on licensed premises, carry the low Class 4 caps, and channel a fixed minimum of their proceeds back to the community.
- Online pokies fall under a separate regime that changed in 2026, with its own licensing and consumer rules rather than the community-grant model.
One point that trips people up is winnings and tax. In New Zealand, casual gambling winnings — including a pokie payout — are generally not taxed as income; our guide explains when gambling winnings are taxed and the narrow exceptions.
Harm, host responsibility and who Class 4 play suits
Because Class 4 is classed as high-risk, the law places harm-minimisation duties on operators and venues. Staff are expected to watch for signs of harm, display help information, and help a player who asks to be excluded from a venue. A portion of every machine’s takings funds the national problem-gambling levy, which pays for treatment and support services.
The harm is not hypothetical. More than 250,000 New Zealanders are estimated to experience some level of gambling harm, and pokies are the single most common mode cited by people who seek help from gambling-harm services. Over time a pokie is designed to return less than it takes, so no amount of play turns it into a reliable source of money.
Realistically, Class 4 pokies suit people who treat a small, fixed spend as paid entertainment and stop when it runs out. They do not suit anyone chasing losses or hoping to win their way out of a financial problem. If gambling is affecting you or someone close to you, see our page on responsible gambling in New Zealand.
Disclaimer
This article is general information about how Class 4 gambling is regulated in New Zealand. It is not financial, legal or gambling advice, and nothing here suggests that any machine, strategy or timing improves your chances — pokie outcomes are random and the long-run return favours the operator. Gambling must be 18-plus on licensed premises. If gambling is causing harm, free and confidential help is available from the Gambling Helpline on 0800 654 655, available 24 hours a day.
Sources
- Department of Internal Affairs – Gaming Machine Profit (GMP) statistics dashboard
- Department of Internal Affairs – Gambling statistics
- Gambling Act 2003 (legislation.govt.nz)
- Gambling (Harm Prevention and Minimisation) Regulations 2004
- Gambling (Class 4 Net Proceeds) Regulations 2004
- Problem Gambling Foundation – Pokies factsheet
Frequently Asked Questions (FAQ)
What is Class 4 gambling in New Zealand?
Class 4 gambling is the use of non-casino gaming machines, or pokies, in venues such as pubs, hotels, bars and clubs. The Gambling Act 2003 defines it as high-risk, high-turnover gambling, and it is regulated by the Department of Internal Affairs.
Who gets the money from pub and club pokies?
After prizes are paid, the remaining gaming machine profit is split between government duty and the problem-gambling levy, GST, the venue’s commission and the society’s operating costs. Non-club societies must return at least 40% of their proceeds to approved community causes as grants.
What is the maximum bet on a pub pokie?
The regulations cap a Class 4 machine at a maximum stake of $2.50 for a single play, a maximum single-play prize of $500, and a maximum jackpot of $1,000 on linked machines. Casino machines are not held to these limits.
Do you have to be 18 to play pokies in a pub?
In practice yes. Pub and bar gaming areas are age-restricted licensed premises, and venue operators must take reasonable steps to keep under-18s off the machines. A casino, by contrast, has a higher minimum age of 20.
How are pub pokies different from casino machines?
Pub and club pokies carry low stake, prize and jackpot caps and must direct a minimum share of their takings to community grants. Casino machines allow higher stakes and jackpots, operate under separate casino licensing, and are restricted to players aged 20 and over.
