The Government of New South Wales (NSW) has decided to introduce a new, “transitional” tax levy to the beleaguered Star Casino in Sydney, with the state’s Treasurer Daniel Mookhey claiming that, without the intervention, the gambling venue would go bankrupt.
In return, the Star will commit to protecting over 3,000 jobs. The casino is known for hiring about 8,000 people depending on its seasonal shifts.
Earlier today, the Minns Government announced an overhaul of the previous tax arrangements for the casino, saying that the move put in danger thousands of jobs if it took no measures to prevent that. As previously reported by Casino Guardian, the Coalition Government had initially proposed increasing the tax rate on poker machine duties by between 46.7% and 60.67% – a move that would bring it additional revenue of about $360 million.
The NSW Government, however, had a change of heart and noted that former Treasurer of the state, Matt Kean, had not held consultations with The Star Casino on the matter. On Friday morning, Treasurer Daniel Mookhey explained that such a tax rate would have made the operations of Star Casino Sydney unviable, as the company would have been forced to close its Sydney operation, and confirmed that the tax rate will rise to a total of 22.91% in 2027. Under the newly-unveiled plans, the rate should stay unchanged until mid-2030.
The “Transitional” Tax on the Star Sydney Would Eventually Bring More Money to the NSW Government
Instead of proceeding with the initial plans and implementing the poker machine duties tax rate of between 46.7% and 60.67%, the Government of New South Wales is introducing a new transitional tax that is set to be paid over the following seven years, as well as a smaller increase on pokie taxes.
Treasurer Mookey claims that, as a result, Star Casino Sydney would pay higher tax than currently does. According to him, the casino would be paying about half a billion dollars more in tax in the period until 2030, with the Government having designed the levy in such a way that would allow it to collect every dollar of available cash that Sydney’s Star Casino could afford to pay.
As revealed earlier today, the NSW Government has held no less than three individual evaluations of the casino’s financial position to make a well-informed decision.
Star Entertainment Group was forced to lay off 500 workers in a job-cutting move back in March. At the time, the company blamed the tax increase on the profits generated by its New South Wales poker machines for its then-ongoing financial difficulties. As part of the Government’s latest announcement, the local authorities will now legally require the casino operator to protect 3,000 jobs for the following six years, while transitioning to a more sustainable business model.
Robbie Cooke, the CEO and Managing Director of Star Entertainment, issued a separate statement to confirm that the company had reached an in-principle agreement with the Government of New South Wales, saying that it was expected to result in an uplift in duties payable to the State. Mr Cooke shared that the agreement would enable the casino operator to continue working at pace in order to implement the reforms required by the Government to restore the reputation and suitability of The Star Sydney.
- Author
Daniel Williams
