HWCC-Tunica, Inc. v. Mississippi Dept. of RevenueAnnotate this Case
HWCC-Tunica, LLC, and BSLO, LLC, had casino members’ rewards programs that allowed members to earn entries into random computerized drawings to win prizes. In 2014, after recalculating their gross revenue and deducting the costs of prizes from their rewards programs’ drawings, HWCC and BSLO filed individual refund claims for the tax period of October 1, 2011, through August 31, 2014. The Mississippi Department of Revenue (MDOR) denied the refund claims in 2015. HWCC and BSLO appealed, and MDOR and the Mississippi Gaming Commission (MGC) filed a joint motion for summary judgment, arguing the plain language of Mississippi Code Section 75-76-193 (Rev. 2016) does not allow a casino to deduct the cost of prizes purchased for a rewards program’s drawings because “these promotional giveaways are not the result of ‘a legitimate wager’ as used in [Mississippi Code Section] 75-76-193.” After a hearing on the motion, the chancellor determined that Section 75-76-193 does not allow HWCC and BSLO to deduct the cost of the prizes and that there were no genuine issues of material fact. After review, the Mississippi Supreme Court found the chancellor erred by giving deference to the MDOR’s and the MGC’s interpretations of Code Section 75-76-193. That error notwithstanding, the Supreme Court found the chancellor reached the right conclusion: that no genuine issues of material fact existed. Accordingly, the Supreme Court affirmed the chancellor’s grant of summary judgment.