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Crown Casino wins Fed Court GST challenge

Crown Casino has won a court challenge over the amount of GST it’s forced to pay when bringing in VIP gamblers on junkets.

Federal Court Justice Jennifer Davies ruled on Thursday that the Australian Taxation Office assessments of what the casino sites in Melbourne and Perth owed were “excessive”.

Crown launched its legal challenge two years ago, disputing whether the cost of commissions and win/loss rebates it paid out for junket tours could be included in calculating their GST obligations.

It was challenging GST assessments for the Melbourne casino between 2010 and 2015, and for two separate periods between October 2007 and July 2012 for its casino in Perth.

Crown argued the commissions and rebates should be taken into account in considering GST amounts, but the ATO said they were payment to the tour operators for marketing, promoting and arranging the junkets.

Junket tour operators negotiate special gambling terms and VIP treatment with the casinos, including in Crown Melbourne and Crown Perth.

They use special chips to track the turnover and VIP’s wins and losses.

She found commissions and rebates paid to the junket operators by the casino, and rebates paid by the junket operators, were “inseverable components”.

“It can be said that the commissions and rebates are not separate and distinct amounts to be disintegrated from the collective win/loss results,” she said.

They are either consideration – or payment – for gambling services supplied by Crown, or the “monetary prize” Crown has to pay for gambling outcomes.

Whether it is payment to or by the casinos depends on whether they had a net win or loss.

Justice Davies examined a sample period for each casino, concluding the assessment of GST owed “were excessive”.

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