James Packer’s Crown Resorts has taken a critical step forward in its quest to build and operate a A$1bn VIP casino resort on the Barangaroo harbour in Sydney with New South Wales politicians voting it as the preferred option ahead of a rival, A$1.1bn bid by Echo Entertainment to redevelop the existing Star Casino.
New South Wales State Premier Barry O’Farrell said: “The decisive factor was the opportunity to introduce competition into the market. There is no agreement yet for a new VIP gaming facility in this city. At any stage the government reserves the right not to proceed.”
Mr. O’Farrell said gaming revenue would be taxed at 29 per cent rather than the 27.5 per cent proposed by Crown.
An independent, government appointed committee concluded that ‘a competitive casino market would deliver increased tourism and broader economic benefits for New South Wales.”
Echo lost value on the stock market as it faces losing its exclusivity as Sydney’s only casino operator.
The NSW government will now proceed to stage three of the approval process if Crown agrees to an upfront license payment of A$100m and a number of other conditions, including that the total license fee and gaming tax payments made to the government over the first 15 years of operation is more than A$1bn.
The committee highlighted that Crown’s Barangaroo proposal, which would cater only to high-end gamblers, would boost gross state product by A$442m a year in 2025.
Already the findings of the committee have come under fire. NSW Greens MP John Kaye commented: “It’s not just the Greens saying there’s a problem with laundered money, it’s also the Nevada casino regulator. It’s also many other casino regulators who are saying these kind of high-roller rooms dependent upon growth from China inevitably bring in corrupt money.”