Australian racing and wagering company Tabcorp Holdings Limited has announced that is has reached a resolution in its dispute with the Australian Tax Office (ATO) that will see the ATO issue a refund of approximately AU$83 million ($53.2 million/€49.8 million).
The refund comes following a dispute initiated by Tabcorp regarding income tax treatment of payments for various licenses and authorities. Tabcorp had initially paid the disputed amount in full while the refund covers about 20% of that amount. Following the resolution, Tabcorp has agreed to drop all proceedings in relation to the disputed tax amount.
As a result of the refund, Tabcorp will now recognize a benefit of approximately AU$45 million ($28.7 million/€26.7 million) after tax in its report for the fiscal year ending 30th June 2024.
In its statement Tabcorp said:
“The settlement also included an agreement in relation to how Tabcorp will treat future license fees payable in respect of renewals of relevant existing licenses. Subject to agreed limitations, Tabcorp must treat the fees as being of a capital nature. Tabcorp does not believe this will have any material effect on future results.”
The announcement also noted that Tabcorp must pay AU$37 million ($23.7 million/€22.2 million) to The Lottery Corporation Limited (TLC). This payment comes under the terms of its Separation Deed dated 25th March 2022 in relation to the demerger of the company’s lotteries and keno business. TLC is now listed on the Australian Securities Exchange as a separate entity.
The news of the tax refund comes just days after the Victorian Gambling and Casino Control Commission (VGCCC) fined Tabcorp AU$1 million ($639,231 million/€597,274 million) for non-compliance with commission directions.
In August, Tabcorp released its annual financial report for the year leading up to 30th June, 2023 (FY23) revealing a 2.4% increase in revenues. According to the latest Global gambling statistics this means that Tabcorp’s latest report shows that the company generates roughly 14% of all gambling revenue in Australia.
Based in London, Natasha is a former sports journalist with experience working for some of the biggest athletes & brands in the world of sports and iGaming.