The state of South Australia last year passed a law to increase payments to the government by the SkyCity casino operation in Adelaide and the SA Tab. The tax would increase in relation to rising costs of running the Office of Liquor and Gambling, the regulatory body, and could amount to hundreds of thousands of dollars. The gaming companies sued the State Government, claiming the extra taxation was illegal.

SkyCity stated that the Government breached its contract with the company when it passed the new law. The tax change, if it remains, would increase SkyCity contributions to A$1.1 million a year from A$870,000. The tax on TAB would go up from A$264,000 to A$400,000.

With the Government facing a payout of as much as A$12 million in compensation if it lost the case at the Supreme Court, documents reportedly show that all the parties involved in the lawsuit have agreed to negotiate towards a settlement.

If a negotiated settlement is achieved then there would be no need to call witnesses such as the South Australian Treasurer and the Opposition gambling spokesman. A status hearing for the case has been set for 30 July 2008. (E-06.17.08)

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