The eagerly anticipated decision from the Nevada Gaming Commission regarding a $3.1 million tax overpayment refund to the company behind the Dotty’s casino franchise was postponed, much to the surprise and disappointment of many. However, it seems that there is a silver lining in this situation, as it appears that the state will not be charging any interest on the owed amount.
During the August meeting, a request was made to refund $3,120,197.28 in gross gaming revenue tax, along with over $222,744.12 in interest, to Nevada Restaurant Services Inc. (NRSI), the company that owns 41 licensed casinos, including various establishments under the Dotty’s and Bourbon Street Sports brands. Auditors discovered in 2021 that NRSI had failed to properly deduct cashable electronic promotion amounts from their gross revenue of $46.9 million, resulting in an overpayment of state gaming taxes.
Initially, the commission was all set to approve the refund in August. However, they hesitated when it came to paying the accrued interest, especially since NRSI had taken a substantial amount of time to request the refund. At that time, the interest on the overpayment was accumulating at a rate of approximately $446 per day.
During the latest meeting, NRSI’s attorney, Kannon Smith, informed the commissioners that the company was willing to forgo any interest payment on the owed amount. Interestingly, NRSI’s research uncovered that tax overpayments had occurred for an additional two years before being discovered. According to Nevada laws and policies, NRSI has the right to request a refund for overpayments spanning up to five years, along with interest. Based on this, NRSI determined that since 2019, the company has overpaid an extra $1.8 million. Smith clarified that the company had no intention of seeking interest payment on this additional amount.
Smith addressed the commission, stating, “I’d like to say that there are millions of dollars that NRSI overpaid in taxes that are outside of this five-year limitation that NRSI cannot make a claim for refund for and so NRSI is just pursuant to the statute making a claim for the full five years.”
Unfortunately, the Nevada Gaming Control Board and the Attorney General’s Office declined to provide a copy of the proposed settlement documents in response to a request from the Review-Journal.
Despite the delay, the commissioners agreed that since no interest was accruing, they could wait until their upcoming October meeting to finalize what is now a nearly $5 million tax refund request. Commissioner Brian Krolicki, who presided over the meeting, expressed his satisfaction with the resolution.
“The issues that arose at the last meeting were just about fairness,” stated Krolicki. “I understand statute and law and we’ve got to do what it says, but there was just something inherently uncomfortable about some of the parts. To create such an unfairness to the Nevada taxpayers in this, I appreciate that you heard that. It was the interest that I think was the only problem. If you’re on record for your client that that interest is waived, you’re getting your rightful money, the principle.”
