PA Lawmakers Now Seriously Considering iGaming Alternatives

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In an effort to reduce a growing budget deficit, Pennsylvania lawmakers are now seriously considering other forms of gambling expansion outside of iGaming.

This week, the Pennsylvania House of Representatives’ House Gaming Oversight Committee held a public hearing on a proposal to legalize Video Gambling Terminals in bars and other businesses across the state.

HB 1010 would essentially allow for the installation of up to 35,000 gaming machines in bars, social clubs, restaurants and other similar businesses all over Pennsylvania.

Arguments Similar to Arguments About iGaming

Apparently, the Video Gambling Terminals would bring in $100 million in gaming taxes in year one and $500 million each year once the total number of machines are up and running across the state.

Lancaster County Democratic Rep. Mike Sturla is behind the bill, and told the committee black market Video Gambling Terminals are already operating all across the state. He also said it’s about time the state started collecting taxes on them.

“Instead of turning a blind eye to an illegal industry that’s going on in the state of Pennsylvania, this really does clean it up for everyone, and lets everyone play on a level playing field,” he said.

Opponents claim Video Gambling Terminals will eat away at the land-based casino business across the state. However, bill sponsors say protecting consumers should come ahead of protecting the business interests of the state’s 12 casino and gaming properties.

Budget projections have the state reducing the deficit with anywhere from $100 million to $150 million from gaming expansion. A lot of that money was expected to come from plans to legalize and regulate online gambling across the state.

Online Gambling Progress Has Slowed

However, the iGaming debate seems to have stalled.

The debate had centered around what tax rate to charge online gambling operations set up by any of the 12 existing brick and mortar casino properties in the state. Proposed iGaming legislation included two bills seeking a 14 percent tax on iGaming operations and a third including a 25 percent tax rate. The proposed legislation also called for upfront license fees of either $8 million or $10 million on each new operator.

Those plans now seem to be on the back burner with lawmakers considering charging online operators the same 16 percent tax on table game revenues and 54 percent tax on slot machines charged to land-based casinos. These represent the highest casino tax rates in the country.

Still others are considering setting up iGaming operations through the state-run Pennsylvania Lottery, and now, alternative gaming expansion ideas like Video Gambling Terminals are getting a closer look.

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Marty Derbyshire has been covering online gambling for various industry media outlets since 2007.

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