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The Star could owe NSW government $2.5m over VIP error

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The Star Entertainment Group may have underpaid the NSW government as much as $2.5 million in gambling taxes by incorrectly classifying local patrons as international high-rollers.

The inquiry into The Star’s Sydney casino licence also heard on Wednesday that the group’s NSW chief casino officer, Greg Hawkins, was unsure if the company had notified the state regulator about the possible underpayment.

Star Entertainment Group.Credit:Flavio Brancaleone

The Star pays NSW duties of 27.5 per cent on money it wins from local players at its Pyrmont casino, but only 10 per cent for winnings from international high rollers.

But the royal commission-style review – which was launched after the Sydney Morning Herald, The Age and 60 Minutes exposed money laundering, criminal infiltration and wide-scale fraud at The Star – heard the casino failed to follow set procedures to determine which tax rate should apply.

That included a requirement for international players to spend no more than 183 days in Australia in a 12-month period, with Hawkins saying he considered COVID-19 border closures a “mitigating factor”.

An internal audit of 25 patrons, who gambled at The Star on its international program between July and September 2020, showed that 12 had breached the 183-day limit. They lost a combined $14 million to the casino, with a potential tax under payment of $2.5 million due to the lower rate.

Counsel assisting Naomi Sharp, SC, asked Hawkins whether he thought the Star may need to pay NSW more tax because it had misclassified local players as international.

“I accept that,” Hawkins responded, adding that he thought “the bulk of the players… were still eligible.”

“In the scheme of total gaming tax we pay which is approximately $350 to $400 million a year, I could have taken a lower risk approach. But I felt I was confident they were still eligible.”



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