New Jersey Senator McKeon Formally Introduces Bill to Hike Online Gambling Tax to 30% in Senate

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 is sponsored by Sen. John McKeon, and its main proponent is the proposal of a tax rate hike to 30% for both types of operations which also includes online casinos.

Bill S3064 was initially reported in March, and has now been presented to the Senate, where it has been referred to the Senate State Government, Wagering, Tourism, and Historic Preservation Committee. 

If enacted, the bill would amend Section 17 of P.L.2013, c.27 (C.5:12-95.19), which specifies the online gambling tax amount. Section 7 of P.L.2018, c.33 (C.5:12A-16), which addresses sports wagering tax, would also be changed.

A tax rate of 30% would see New Jersey’s revenue increase to $609.7m and increase its competitiveness with the neighboring states.

How New Jersey Compares to Other States’ Casino Taxes

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. New Jersey’s online gambling and sports betting are taxed at 15% and 13% of gross gaming revenue respectively.  

When it comes to internet casinos, New Jersey holds the distinction of one of the states in the USA that has the lowest tax rates and 30 igaming sites currently active. A 30% GGR tax would put the state above Connecticut (18% of GGR rising to 20% after five years), Michigan (20%) and West Virginia (15%). 

In contrast, neighboring states such as New York and Pennsylvania have some of the highest online gaming tax rates. New York imposes a 51% tax rate, while Pennsylvania operators pay 36%. This results in significantly higher revenue intake than New Jersey.

Meanwhile, 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.

All Eyes on New Jersey’s Casino Industry

Bill S3604 is just one of the events making noise in New Jersey’s casino industry. Recently, New Jersey’s brick and mortar casino operators are facing an issue involving citizens and some of their employees lobbying to stop the allowance of indoor smoking within casino premises.

Many lobbyists are aiming to overturn an 18-year old law that exempted casinos that operate in Atlantic City from the indoor clean air law. This exemption has led to many casino workers susceptible to health risks that come from working in a smoke-filled environment. The litigation seeks to have that exemption declared unconstitutional on several grounds, including equal protection under the law.

Last Updated on by jonathan r

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