The Crown Resorts Ltd (ASX: CWN) share price will be in the spotlight on Wednesday morning following a Victorian casino tax update.
At yesterday's market close, the casino operator's shares finished the day down a sizeable 5.47% to $8.98.
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Victorian casino tax update
In Tuesday's late market release, Crown Resorts provided an update to the ongoing review of potential casino tax underpayments by Crown Melbourne.
The group stated that it has resolved to make payment to the Victorian Commission for Gambling and Liquor Regulation (VCGLR). From the 2012 financial year until yesterday's date, Crown Resorts underpaid approximately $37 million in casino tax. This is in relation to Crown Melbourne incorrectly deducting certain bonus rewards given to customers from its electronic gaming machines.
As a result of the underpayment, Crown Resorts incurred $24 million in penalty interest for the nine-year period. Combined with the principal amount, Crown has paid a total of $61 million to the state of Victoria. The VCGLR has been notified of the above outcome.
In addition, Crown went on to note that it is continuing to assess other aspects of casino tax payments. This includes the company's review of its loyalty promotion, Matchplay. Using Matchplay, Crown Rewards Points are redeemed for credits to use in electronic gaming machines.
Once the Victorian Royal Commission delivers its final report, the VCGLR advised it will finalise Crown's potential casino tax underpayments.
Crown share price snapshot
Since mid-May, Crown shares have recorded heavy losses of more than 30% for investors. These levels have not been seen since November 2020 where an AUSTRAC investigation took place.
However, when looking over a longer period, the company's share price is relatively flat. Year to date the Crown Resorts share price is down 6.75%. While over a 12-month period Crown shares are down just 0.22%.
Based on valuation grounds, Crown Resorts commands a market capitalisation of roughly $6 billion, with around 677 million shares outstanding.
