The South Australian Court of Appeal recently ruled that SkyCity Adelaide will in fact face a casino tax liability of AU$13 million (US$8.5 million), settling a longstanding dispute with the state Treasurer over the taxation of loyalty rewards.
The ruling sided with the Treasurer’s interpretation of the state’s 1999 Casino Duty Agreement, asserting that loyalty credits used by customers during gaming machine play must be included in the casino’s gaming revenue, and that points accrued by players must not be deducted from revenue.
SkyCity confirmed the decision in a filing to the Australian Securities Exchange.
The back-payments encompass loyalty point deductions from the period of January 2014 through January 2024. That said, the company also noted that the court did side in its favor with regard to interest penalties on the back-payments.
“As a result, the question of the applicable interest rate for outstanding duty, and whether the contractual interest provision is enforceable, remains to be determined by a single Judge of the Supreme Court at a later date,” the company said in its filing.
If the Supreme Court also ultimately rules against the operator, it could face an additional penalty of AU$20 million (US$13.1 million).
In response to the ruling, the company said in its filing that it is currently considering its position in relation to the Court of Appeal’s judgment and the impact on the current structure of its customer loyalty programme.”
