On December 17, the New South Wales (NSW) state government released a statement detailing proposed changes to the region’s casino tax rates in order to help fund vital services and “invest in communities recovering from the unprecedented impacts of COVID-19, bushfires and floods.”
Although the exact details of the increases were not specified, the government is positing that they will raise “an additional AU$364 million (US$244 million)” over the course of the next three years.
According to the statement, the changes would come into effect July 1 of next year, and would affect the “rates on what the casinos earn from gaming tables and poker machines.”
Matt Kean, NSW treasurer, said in the release that the new rates “will replace the existing regime under which casinos pay less tax on poker machines than hotels and clubs.”
One of the country’s biggest operators, Star Entertainment, has not taken well to the news, with the company having released a statement saying that it received “no consultation from the NSW Government” on the matter, and that it is “seeking to urgently engage” with state officials about the potential impacts the increased taxes may have moving forward.
Robbie Cooke, CEO of Star, said in the company’s statement that he is “not sure how the Government modeled its financials nor the basis for suggesting The Star does not pay its fair share of taxes. Specifically, in addition to state gaming taxes, The Star also pays millions in corporate taxes, with total taxes paid as a percentage of The Star’s profits being around 70 percent, and as high as 80 percent in the last 5 years when all the tax regimes are considered.”
The relationship between Star and NSW regulators in recent years has not been particularly peachy—the company has already been deemed unfit for casino licensure in the state, and its flagship Star Sydney casino is currently under the supervision of a state-appointed independent monitor to better ensure compliance.
