Pennsylvania Gives Online Gambling Legislation Another Go

Road to Pennsylvania Online Gambling LegislationPennsylvania has been dancing with the idea of introducing online gambling legislation as a tax income revenue stream for quite some time. But despite healthy amounts of interest by some lawmakers, businesses, and the state’s land based casinos, any substantive progress on passing such legislation has continually been kicked down the road like a can full of casino chips.

Now, it is looking like the regulation of online casinos could become reality in 2017 in the Keystone State. On January 2nd, a memorandum was released, revealing that the online gambling bill the House passed during the 2016 session will be used as a base for a new legislation to be introduced in Harrisburg by Democrat Jay Costa. Senator Costa expressed that he plans on doing so “in the near future”.

The bill that will be used as Senator Costa’s base came a long way in 2016, but languished without the appropriate vote in order to determine its merit to either pass or fail in the eyes of the legislature. Primarily, the bill had been structured to address a faulty tax issue, which was leaving certain smaller casinos paying a much higher rate in taxes than other casinos. The urgency to address these tax issues have motivated lawmakers to makes more serious moves toward accomplishing the goal of this original piece of legislation.

Senator Costa described his desire to support the industry in its growth and evolution in order to, “allow the Commonwealth’s gaming industry to continue to evolve and remain competitive in a responsible manner.”

Outside of Nevada, Pennsylvania boasts the largest casino industry out of the fifty United States. But as other states in the northeast continue to broaden and strengthen their own casino industries, Pennsylvania’s industry has suffered a plateau in growth during 2016. This stagnation has prompted the state to look at more creative and forward thinking ways to generate revenue streams that could bolster the state’s tax coffers.

With a $10 million dollar licensing fee, each of Pennsylvania’s 12 land-based casinos would be eligible to run an online platform for their casino. Currently, ten of the casinos have expressed interest to apply for the privilege and pay the necessary fees. Each would also be under rigorous regulation standards. The casinos will be allowed to partner with outside gaming software companies that specialize in online casino technology. These outside contractors will also be held to a licensing fee of $5 millions dollars and the corresponding regulatory measures.

In addition to the licensing fees, all online gambling revenue generated by the state’s online casinos will be taxed at a rate of 25 percent. This also includes fantasy sports, and sports betting.

Initial projections have Pennsylvania’s online gaming industry bringing in roughly $300 million dollars annually.
Thus far, the bill has already received bipartisan support. Both Republican senator Kim Ward and Democrat Jay Costa have expressed commitment to continue working on the bill and discussing its provisions in order to best find a way for it to be passed in this current session of legislation.

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