Crown Casino is heading to court in a bid to quash a $362 million tax bill it believes should be written off against legitimate business expenses.
At the heart of the disagreement with the Australian tax authority is the way Crown handled its unsuccessful US ventures between 2009 and 2014. According to the casino operator, it has paid the correct amount of tax given how it cut ties with its former assets in Las Vegas.
US Losses Under Scrutiny
In 2007, Crown bought Cannery Casinos in Las Vegas for $2 billion. The plan was to launch the brand in the US, starting with a property in Sin City.
However, following the economic crash, Crown paid $50 million to renegotiate the deal and take a 24.5 percent stake in the company instead. In 2014, it was a similar story as the company failed to get the proposed Alon Las Vegas project off the ground due to financial constraints.
In launching and then ending these ventures, Crown believes at accrued a number of costs that can be written off against its current tax liability. The tax office disagrees and now the two parties will contest the matter in court on August 31.
A request for comment by Reuters wasn’t acknowledged by either party, but Crown has previously stated that it has its financial affairs in order.
“Crown considers that it has paid the correct amount of tax and intends to pursue all available avenues of objection (including, if necessary, court proceedings),” reads the company’s August 2017 annual report.
Pokie Spending in Victoria Hits Ten-Year High
In other Australian gambling news this week, pokie losses in Victoria were the highest since 2008/2009. According to a report published by the Victorian Commission for Gambling and Liquor Regulation (VCGLR), residents wagered just short of $2.7 billion between 2017 and 2018.
As well as being the highest result for a decade, the total is an increase of 3.29 percent on the latest accounting period. Across the state, the VCGLR recognises 26,380 licensed poker machines, with the City of Brimbank generating the largest regional loss of $139.5 million.
The findings come just one week after the Alliance for Gambling Reform and Tim Costello called for a $1 wagering limit on pokies. Unveiled as part of the coalition’s July 24 election platform, the manifesto calls for greater protection for consumers and legislative changes similar to the UK.
Following a long-standing debate, the British government announced a reduction in betting machine stakes on May 17. Although the system has yet to be implemented, its effect on high street betting shops in the UK is expected to be profound.
For Costello, this is something the Australian government can learn from, especially in light of the data published by the VCGLR.