The Star Entertainment Group Ltd Settles ATO Disputes and Secures $33M Refund
The Star settles long-running tax disputes with the ATO, secures $33m refund
The Star Entertainment Group (ASX: SGR) has settled its long-running disputes with the Commissioner of Taxation, resolving a legacy tax matter and securing a refund of approximately $33 million.
The disputes related to the GST and withholding tax treatment of payments made by the Group to junket tour operators. The GST treatment of rebates covered the period October 2013 to August 2017, while the dispute over the appropriate method for calculating withholding tax spanned July 2014 to June 2020.
For investors, the settlement removes uncertainty around a legacy liability that had remained unresolved for several years.
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What the settlement means financially
The Star had previously paid the Commissioner approximately $88 million of the disputed amount. As part of the settlement, the Commissioner will refund the company approximately $33 million, leaving The Star to take a charge of approximately $55 million for the year ending 30 June 2026.
The outcome crystallises the net position and removes ongoing uncertainty tied to the disputed amounts.
| Item | Amount |
|---|---|
| Amount previously paid to Commissioner | ~$88 million |
| Refund from Commissioner | ~$33 million |
| Charge for FY ending 30 June 2026 | ~$55 million |
Understanding junket tour operators and why this matters
The tax treatment of those payments became the point of contention. The dispute centred on how much GST applied to the rebates paid to operators, and the correct method for calculating the withholding tax owed on those payments over the relevant periods.
The Star ceased all dealings with junket tour operators in October 2020, meaning the settlement resolves a matter tied to a business activity the company exited several years ago.
Key takeaways for investors:
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The disputes relate to a business activity exited in October 2020
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The settlement finalises the outcome with the ATO
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The net cash and accounting impact is now known
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A cleaner path forward
The settlement removes a legacy overhang tied to a discontinued business activity, with the matter now resolved with the Commissioner of Taxation.
The ATO settlement adds to a sequence of balance sheet developments for the company, following the $540M refinancing secured with WhiteHawk Capital Partners that extended debt maturity to 2029 and injected approximately A$130 million in fresh liquidity.
The announcement was authorised by Bruce Mathieson Jnr, Group Chief Executive Officer & Managing Director.
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