AG: Greenetrack owes $76M in taxes from ‘illegal’ gambling

AG: Greenetrack owes $76M in taxes from ‘illegal’ gambling

By MARY SELL, Alabama Daily News

The Alabama Attorney General is asking a circuit court to make Greenetrack pay more than $76 million in taxes on revenue from its slot machines.

“It is the opinion of the Attorney General that Greenetrack violated Alabama’s tax laws by not paying any state taxes on its illegal gambling operations,” Attorney General Steve Marshall’s office told Alabama Daily News Monday.

The appeal, filed Friday in Greene County Circuit Court, comes after an Alabama Tax Tribunal August decision that voided more than $76 million in tax assessments from the Alabama Department of Revenue against Greenetrack, which also allows betting on simulcast horse and dog races. The state had argued that the revenue from the track’s bingo operations were never exempted from state taxes, unlike the parimutuel betting revenue that is tax exempt under a 1975 state law. The track argued that when people voted to allow bingo at the track in 2003, the tax exemptions from parimutuel betting legally extended to bingo. The Tribunal sided with Greentrack.

“The tax tribunal’s decision would allow racetracks to operate illegal gambling tax free,” the statement to ADN said.

A call to an attorney for Greenetrack was not returned Monday.

In the appeal, Marshall’s office argues Greenetrack has not carried its burden of showing that the Alabama Legislature intended for Greenetrack to be exempt from paying all sales and use taxes related to its multi-million-dollar bingo operations simply because it also happens to be licensed to offer parimutuel wagering on dog racing.

“Under Greenetrack’s fanciful interpretation, a company like Wal-Mart would be well served to become a racetrack licensee so that it also would not have to remit any sales taxes on the majority of goods and services it sells.”

The AG’s office says the money owed is from 2004 through 2008. Greentrack had about 1,500 ‘electronic bingo’ games that were in effect slot machines. In 2007 alone, Greenetrack made more than $68 million from these machines, after winners were paid, the AG says.

According to the appeal, the Alabama Department of Revenue calculates Greenetrack’s obligation to be $75.5 million in sales tax and $746,292 in consumer’s use tax.

It’s been almost two years since Marshall filed civil lawsuits against casinos in five counties, including Greenetrack. Marshall said the Alabama Supreme Court has made it “abundantly clear” that the games are illegal. The lawsuits are pending.

Alabama lawmakers are watching the tax appeal case. State Sen. Greg Albritton, R-Range, last month said he disagreed with the tribunal ruling and a change may be needed to state law.