Star Entertainment Settles Australian Tax Dispute Over Junkets
The Star Entertainment Settles Tax Dispute With Australian Authorities – Refund and Additional Charges Confirmed for FY2026
Key Takeaways
- The Star Entertainment Group has settled longstanding GST and withholding tax disputes with the Australian Taxation Office.
- The disputes relate to payments to junket operators between 2013 and 2020.
- The operator will receive a refund of approximately AUD 33 million after previously paying around AUD 88 million.
- The company expects to record a charge of about AUD 55 million for the financial year ending 30 June 2026.
- The settlement follows additional fines of AUD 10 million imposed by the New South Wales Independent Casino Commission.
Settlement Covers Historic GST and Withholding Tax Treatment
The Star Entertainment Group has reached a settlement with the Australian Taxation Office concerning the historic treatment of Goods and Services Tax and withholding tax on payments made to junket operators. The agreement concludes disputes covering multiple financial years.
The GST component relates to the period between October 2013 and August 2017 and focuses on the tax treatment of rebates paid to junket operators. In addition, the dispute addressed the calculation method for withholding tax between July 2014 and June 2020.
According to the company’s half-year 2026 financial statement, the Taxation Office alleged that The Star had underpaid GST on rebates and commissions paid to junkets. The total claim amounted to approximately AUD 157.9 million. This figure included AUD 81.9 million in primary tax and AUD 76 million in interest.
A separate claim of AUD 8.4 million concerned withholding tax on junket rebate payments. Of this amount, AUD 6.4 million related to primary penalties and AUD 2 million to interest.
Refund and Financial Impact for FY2026
Before the settlement, The Star had already paid approximately AUD 88 million to the Commissioner of Taxation in relation to the disputed amounts. Under the terms of the agreement, the company will now receive a refund of around AUD 33 million.
Despite the refund, The Star stated that it will record a charge of approximately AUD 55 million for the financial year ending 30 June 2026. This accounting impact reflects the final resolution of the dispute and the financial adjustments required under the settlement.
For readers evaluating operators in regulated markets, the resolution removes one significant area of tax uncertainty related to historic junket arrangements. The company had already ceased dealings with junket operators in October 2020.
Background: End of Junket Operations in 2020
The tax disputes relate to a period during which The Star engaged with junket operators, a business model that was discontinued in October 2020. The settlement therefore addresses legacy matters rather than current operating practices.
The company is now under new leadership following its acquisition last year by Bally’s Corporation and Investment Holdings. The resolution of the tax dispute marks another step in addressing prior regulatory and compliance issues linked to earlier periods.
For international users monitoring regulatory stability, the timeline is relevant. The tax claims concern conduct and tax treatments from 2013 through 2020, while the junket model itself has not been part of The Star’s operations for several years.
Additional Regulatory Action by NSW Independent Casino Commission
While the tax settlement closes one chapter, The Star Sydney has recently faced further regulatory action in New South Wales.
Last month, the New South Wales Independent Casino Commission imposed fines totaling AUD 10 million on The Star Sydney. In addition, the regulator required an enforceable undertaking that obliges the operator to allocate a further AUD 5 million to strengthen its financial crime risk management technology.
The regulatory action followed investigations by Liquor and Gaming NSW into thousands of breaches identified last year. Four separate disciplinary matters resulted in distinct penalties:
– A AUD 1.5 million penalty for allowing customers to gamble continuously without a break longer than prescribed time limits between May 2024 and April 2025.
– A AUD 3 million penalty for permitting the conversion of casino reward points to cash for at least 1,898 patrons between December 2018 and November 2023.
– A AUD 500,000 penalty for failing to prevent an excluded patron from entering the casino on nine occasions between February and May 2024.
– A AUD 5 million penalty, alongside the AUD 5 million enforceable undertaking, for systemic failures in financial crime risk operations between July 2023 and September 2025.
The enforceable undertaking requires the funds to be held in a dedicated remediation account to support improvements in technological capabilities linked to regulatory compliance in financial crime risk management.
Company Response and Ongoing Remediation
Bruce Mathieson Jnr, Group Chief Executive Officer and Managing Director at The Star, stated that the company takes its regulatory obligations seriously and acknowledged the structured payment arrangement that allows penalties to be paid progressively until 30 June 2027.
He noted that the events underlying the disciplinary action occurred between December 2018 and September 2025 and prior to the commencement of the current leadership team. The company confirmed that it will continue to engage with the New South Wales Independent Casino Commission while progressing its remediation program.
For users assessing operator reliability and regulatory standing, these developments highlight both the financial consequences of past compliance failures and the structured oversight now in place.
Our Assessment
The settlement with the Australian Taxation Office concludes disputes over GST and withholding tax linked to junket operations between 2013 and 2020 and results in a partial refund alongside a FY2026 charge of approximately AUD 55 million. At the same time, The Star Sydney faces AUD 10 million in fines and a mandated AUD 5 million remediation fund following findings by the New South Wales Independent Casino Commission. Together, these measures define the current regulatory and financial position of the operator as it continues its remediation efforts under new ownership and leadership.
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