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Tatts Sues Australian Province over Poker Machine Levy

Tatts Group has followed rival Australian gambling company Tabcorp in suing the government of Victoria over a combined levy of AUS$84.6 million they’ve been charged for operating poker machines in the province.

The gaming companies have been asked to pay AUS$42.6 million and AUS$42.0 million respectively for gaming operations conducted by the pair in the financial year 2012-13.

The suit comes less than a month after the two companies made public their opposition to paying the so-called health benefit levy which the province introduced in July 2000. The levy is applied to poker machines operated in Victoria and is used to help fund hospitals and charities.

But both Tatts and Tabcorp lost their duopoly to operate poker machines outside of Melbourne’s Crown casino, on August 15, 2012. As a result of the expiry of their gaming operator’s licence on August 15, the companies argue their gaming operations in Victoria were limited to 46 days.

Tatts’ said that its gaming operations under the licence generated earnings before interest, tax and depreciation of about AUS$29 million – much less than the amount of the levy sought by the government of Victoria.

“Tatts strongly disputes the reasonableness of the determination made by the Treasurer and its legal sustainability,” Tatts said in a statement earlier in the month.

According to the Sydney Morning Herald, Tatts commenced proceedings on Wednesday against the Victorian Treasurer Michael O’Brien in the Supreme Court of Victoria. The suit follows similar legal action filed by Tabcorp two weeks earlier.

The move to sue over the licence fee is only the latest in legal actions taken by the two Australian gambling concerns against Victoria over the last year.

In 2012, both companies sued the province for a combined total of AUS$1 billion after a 2008 decision in which the government of Victoria said it would discontinue Tatts’ and Tabcorp’s duopoly over 27,500 poker machines in the state’s pubs and clubs in favour of the owner-operator model favoured in the neighbouring province of New South Wales.

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Bradley Chalupski

Bradley Chalupski made his first deposit onto an online poker site in 2009 and has been paying rake and following the poker scene ever since. He received his J.D. from the Seton Hall University School of Law in 2010.

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