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Crown Melbourne fined another $20 million for historical tax avoidance

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Crown Melbourne fined another $20 million for historical tax avoidance
Victoria’s gambling regulator has imposed a further $20 million fine on casino operator Crown Melbourne for claiming tax deductions to which it was not entitled for almost a decade between 2012 and 2021.

The state’s royal commission in Crown’s operations and suitability to hold a gaming licence found that Crown claimed tax deductions by reclassifying loyalty benefits afforded to its members as winnings and hid the move from the state’s gambling regulator at the time.

Since the royal commission’s findings, the casino operator has repaid $37.4 million in unpaid tax to the state government along with interest of around $24.1 million. On Friday, the Victorian Gambling and Casino Control Commission (VGCCC) fined Crown Melbourne $20 million for the wrongdoing.

“Crown and other gaming licensees have important obligations to pay gaming taxes to the state,” said VGCCC chairperson Fran Thorn in a statement announcing the penalty on Friday.

 “Not only did Crown breach its obligations by claiming tax deductions to which it was not entitled, Crown also made significant efforts at concealment.

“The VGCCC will not tolerate this behaviour. We expect licensees to comply with their tax obligations and to be transparent in their dealings with us.

“We have today imposed a significant fine of $20 million on Crown to send a clear message that this type of conduct will be met with strong disciplinary action.

“This fine also sends an important message to other gambling operators about the importance of complying with their obligations to pay gambling taxes and the need for frank and open dealings with the regulator.” 

On behalf of Crown Melbourne, its CEO, Mike Volkert, said in a statement on Friday that the casino “accepts” the penalty outcome from the VGCCC.

“These historical breaches, decisions and actions have no place at Crown, and under new ownership and leadership, we are committed to an open, constructive, and transparent relationship with our regulators and stakeholders, as well as improving internal controls and our regulatory reporting requirements,” said Volkert.

“Our Future Crown program is driving whole-of-company reform and we are focused on building a Crown that exceeds the expectations of our stakeholders and the community.

“This practice ceased in 2021 and Crown has since made the required payments to meet its casino tax obligations.”

Including last week’s fine, the gambling regulator has now handed out $250 million in penalties to Crown Melbourne. Crown Resorts, the overarching company which also has Crown Sydney and Crown Perth in its portfolio has a proposed $450 million fine pending federal court approval, for its anti money laundering and counter terrorism financing failures at the Melbourne and Perth properties.

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