Casino News

Calgary Stampede Uses Casino Business to Bypass Intermediate Taxation, Says University Professor

The annual Calgary Stampede is one of the most famous events held in the region, with literally every Calgarian being familiar with it. The unique undertaking combines private ventures, including gambling and casino offerings, public land, youth programs, agricultural education, etc.

The entity, which is known for generating approximately CA$150 million per year, is legally known as Calgary Exhibition and Stampede, Ltd. A board of directors, most of whom are being appointed by the shareholders of the organization, is engaged with the governing of the entity. It is also famous for running a broad range of operations, including a non-profit organization and a charity arm.

A number of businesses are currently being owned and operated by the Calgary Stampede, with the Cowboys Casino being one of the most popular ventures. The gambling facility is owned by the Stampede Casino Limited Partnership, which on its turn is formed by Calgary Stampede GP Inc. and Calgary Stampede Trust.

Cowboys Casino Remains Important Part of Calgary Stampede’s Structure

Some may be surprised that an undertaking such as the Calgary Stampede also features some gambling services through the casino.

However, as revealed by CBC News, University of Calgary’s professor of business law Bryce Tingle explained that the latter is actually an important part of the Stampede’s structure. According to Mr. Tingle, the casino business serves a tax-efficient way to redirect money from the profitable gambling business to the parent company to bypass possible intermediate levels of taxation.

What is even better, is the fact that the casino business ensures protection to Stampede, as the non-profit organization cannot be held liable for any problems that might occur at the gambling venture, which could include situations varying from legal action to bankruptcy.

As mentioned above, the Calgary Stampede is a non-profit organization. Last year, the venture reported gross revenue worth approximately CA$142 million generated by its own activities. In addition, it received another CA$7.7 million in grants from the Government of the province of Alberta. This makes a total income exceeding CA$150 million, with the 10-day summer event bringing about half of that amount. In 2017, the event generated CA$78.2 million in gross revenue, generating an increase from the result posted in 2016.

Event services and facility rentals accounted for the second-largest chunk of the gross revenue of Calgary Stampede in 2017, while the Cowboys Casino business was the third largest source of revenue, contributing roughly CA$14 million.

As far as the net income of the Calgary Stampede is concerned, the picture is different. The casino business of the organization contributed profit of CA$1 million only in 2017 after taxation and other expenses were paid. The Stampede’s event-hosting business, on the other hand, brought in a total of CA$12 million, while the 10-day summer event in 2017 contributed another CA$20.9 million.