The High Court of Australia has ordered SkyCity Entertainment Group to pay an additional A$13.1m (approx €8m) in casino duty to the Treasurer of South Australia over a dispute about loyalty points and gaming revenue.
The dispute was over the interpretation of the Casino Duty Agreement dated 27 October 1999, regarding the “treatment of loyalty points converted to gaming machine play for the purpose of calculating casino duty at the SkyCity Adelaide casino”.
In a statement, the operator said the High Court ruled against SkyCity, confirming the South Australian Court of Appeal’s interpretation of the agreement of “credits on gaming machines arising from the conversion of loyalty points, when played by customers, are to be included in gaming revenue for the purpose of calculating casino duty at the SkyCity Adelaide casino”.
As such, SkyCity Adelaide is now obliged to pay an additional A$10.3m casino duty in addition to A$2.8m “of additional casino duty payable as a consequence of that part of the Court of Appeal’s earlier judgement that was not appealed to the High Court”.
The High Court has also ruled in favour of the Treasurer of South Australia’s position on the interest clause in the agreement, which amount will be determined by a judge of the Supreme Court of South Australia at a later date.
SkyCity has stated that if the Supreme Court’s decision is unfavourable to SkyCity Adelaide, the casino could be forced to pay penalty interest on the additional casino duty, “which could be up to around A$25.3m”.
As of 30 June 2024, the operator had recognised the provision of A$13.1m concerning the potential additional casino duty payable, but not the possible penalty interest as “there remain a range of potential outcomes and no present obligation exists”.
“This is a long running matter involving highly technical tax issues regarding the calculation of casino duty,” commented Jason Walbridge, CEO of SkyCity.
“Given the complexities, both parties decided to seek declaratory relief through the court. We look forward to the resolution of this matter and will continue to work with RevenueSA to achieve this.”
