Disputes over one billion AUD in COVID-19 assistance and other payments have finally been laid to rest. Tabcorp has received a refund of AU 83 million dollars. Seventeen filings against the ATO were resolved, as part of the same settlement. Tabcorp, The Australian Lotteries Commission and Tabcorp’s subsidiary, Max Holdings, are beneficiaries.
Proceedings begun in 2019 against the Australian Tax Office have finally been resolved, with Tabcorp coming out a winner.
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Tabcorp Holdings Limited (Tabcorp) announced that they would be refunded approximately 20% of the “disputed tax liabilities and interest”. This puts the full disputed sum at a total of $415 million. However, at the end of September 2021, it was reported that the total sum being appealed was around one billion Australian dollars. This means that over half of the originally disputed amount was not recognised by the courts.
Tabcorp will need to pay The Lottery Corporation Limited (TLC) almost half of the refund. TLC will receive $37 million. At the end of May, 2022, TLC demerged from Tabcorp. The ATO refund applies to parts of Tabcorp Holdings that would then later split off to become part of TLC. As all disputes were filed in 2021, it has been speculated that the inconsistencies were spotted during internal audits and planning for the demerger.
Historical Tid Bits
Tabcorp has a long and illustrious history in the Australian gambling industry. As do many of the companies and entities they have acquired over the years. One such famous acquisition by Tabcorp is Tattersalls. Tatts Group’s founder, George Adams, held the first Sydney Cup Sweepstakes out of his pub in 1881. He moved to Tasmania, and with the support of the state government, began the region’s first lottery there.
Apart from spreading far and wide in Australia, George’s company is famous for its “Tattersall’s Heirs”. As Adams had no children at his death, his estate’s Trustees were the beneficiaries of his Will. Their descendants inherited the benefits and their identities became difficult for the public to track. Adams’ Will is also famous for its meticulously detailed instructions stipulating how the company was to be run. The Will was still regularly consulted over 100 years later, with the company thriving. Adams was also unusual in that he granted, in perpetuity, 10% of net profit to employees, for bonuses and perks.
The company was private for over a hundred years and became increasingly powerful. The government applied significant pressure to make the century-old private company go public. They believed that the lack of transparency granted to private companies was not acceptable for one with such power, wealth, and reach. Tatts had a monopoly on lotteries throughout Australia, other than the state government-owned, Lotterywest. Finally, Tatts Group floated in 2005 for AU$290 million.
However, a little over a decade later, Tabcorp absorbed the famous Tatts Group in 2017. Four years after the mutual merger, in July 2021, it was announced that Tabcorp would demerge its lotteries and keno business. The following year, the demerged lotto and keno section began trading on the ASX as, The Lottery Corporation (TLC). This resulting company, smacks of a “reimagined Tattersalls”.
Tabcorp’s subsidiary company Tabcorp Maxgaming Holdings Limited (Max) provides technology and gaming services for gaming venues, suppliers and governments. Max was the other entity that filed appeals against the ATO and whose disputes were wrapped up together in the recent refund resolution. In July of this year, they were awarded the monitoring duties for all electronic gaming machines (EGMs) in pubs and clubs in Tasmania.
The march of the giant that is Tabcorp, continues on.
