A bill aiming to increase tax rates for online sports betting and casino operators in New Jersey has been officially introduced to the Senate. Bill S3064, sponsored by Sen. John Mckeon, proposes a tax rate hike to 30% for both types of operations.
Presently, online sports betting operators are taxed at 14.25%, while iGaming operators pay 15% in tax, plus an additional 2.5% to the Casino Reinvestment Development Authority. Initially reported in March, the bill has now been presented to the Senate, where it has been referred to the Senate State Government, Wagering, Tourism, and Historic Preservation Committee.
If implemented, the proposed 30% tax rate would impose a substantial burden on New Jersey’s 18 mobile sportsbooks, elevating taxes to among the highest in the United States.
Comparatively, neighboring states such as New York and Pennsylvania already have some of the highest online gaming tax rates, resulting in significantly higher revenue intake than New Jersey. New York imposes a 51% tax rate, while Pennsylvania operators pay 36%.
States like Delaware, New Hampshire, and Rhode Island levy taxes between 51% and 50% of Gross Gaming Revenue (GGR), although they operate monopolies through state lotteries. In Illinois, legislators have also advocated for an increase in sports betting tax.
Since its launch in January 2022, New York has generated $1.73 billion in online sports betting tax revenue from $39.2 billion in handle, whereas New Jersey has accumulated just $286.7 million in tax revenue from $26.1 billion in handle during the same period. If New Jersey had imposed a 30% tax rate over that time frame, its total revenue would have amounted to $609.7 million.
In terms of internet casino taxation, New Jersey currently maintains one of the lowest tax rates, with 30 iGaming sites currently active. However, a 30% GGR tax would position the state above Connecticut (18% of GGR, increasing to 20% after five years), Michigan (20%), and West Virginia (15%). Pennsylvania holds the highest tax rate for slots at 54%, while table games are taxed at 16%.
Original article: https://www.yogonet.com/international/noticias/2024/04/12/71709-new-jersey-senate-formally-introduces-bill-to-increase-tax-rates-for-online-betting-and-casinos
