Star Sydney workers union voices concern over casino tax hike

April 19, 2023 12:49 pm.by Omale Godwin

The United Workers Union, which represents employees at The Star Sydney, has requested a meeting with the recently appointed New South Wales state treasurer, Daniel Mookhey, in light of concerns that a proposed increase in casino tax rates could have a negative impact on thousands of jobs.

United Workers Union leader Dario Mujkic has written to Mookhey warning that the tax hike could cost the casino around $100 million per year and could result in job losses for some of the casino’s 4,500-strong workforce.

Last December, then-treasurer Matt Kean announced that coming July 2023, the government will increase casino gaming tax from 31.57% to 60.67%. He also promised that the realized funds will be used to provide succour for disaster victims while also reflecting Victoria’s tax rates.

However, The Star is threatening to conduct a review of its NSW business if the newly elected treasurer goes on with the plans of his predecessor. The proposed tax increase could seriously harm the future earnings capacity of The Star Sydney, according to warnings issued by the company in February.

READ: Star Entertainment unhappy with proposed casino tax hike

The company predicts a non-cash impairment charge of between $400 million and $1.6 billion in relation to its NSW business if the proposed casino tax rate is implemented. However, if there is no change in the NSW tax rates, all things will remain the same.

According to The Sydney Morning Herald, confidential briefings from NSW Treasury officials to the government last week revealed that the proposed tax hike was announced without any consultation and would also put the NSW rate above that of Victoria, home to Crown Melbourne. This is because Victoria provides credit towards state taxation for GST paid on non-rebate and gaming revenue.

Commenting on the move, Star Entertainment Group CEO Robbie Cooke noted that the former government practically turned deaf ears to them as all attempts to reach them concerning consultation proved abortive.

“We were blindsided by this proposed tax. There was no consultation. It was dropped on us right before the Christmas break. Was due process followed?” he said.

By the looks of it, the labour union will be the one to bear the brunt of the heavy tax rate if it becomes effective. This is because labour accounts for a majority of Star’s spending.

In the letter, Mujkic reiterated: “Our union believes in progressive taxation, but I don’t think this proposal was ever about tax justice, it was really about having someone – Star – to attack politically in the context of the gambling reform debate.

“Star has been fined by regulators left, right and centre, and they are going through a very thorough remediation program. That is entirely appropriate because of misconduct and poor management. But I think this tax increase was additional to that.”

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