When sports betting finally debuts in the Keystone state’s casinos, it is anticipated that it will have the highest sports betting tax rate in the United States. There has been a lot of debate about how this could affect the budding industry, especially because prior to the lifting of the ban on sports betting, a number of gambling operators were operating tax-free. Concerns have been raised regarding how these rather high taxes could affect the development of sports betting.
However, there is a high likelihood that when sports betting finally reaches Pennsylvanian casinos, the high tax rates will not be much of a deterring factor for them. The state will have the highest tax rates -that much is true – but the returns of sports betting are too lucrative for some of the casino operators to let slide by.
“It’s not even close,” Prof. Chuck Berry, who teaches sports entertainment at Point Park University commented about the yet to be confirmed tax rates. “Most of the states are somewhere between 10 and 20 percent. Nevada is around 7 percent. And we’re going to be at 34 percent plus an extra 2 percent, 36 percent, and that doesn’t include the federal excise tax as well.”
A number of gaming companies have raised complaints about Pennsylvania’s 36 percent tax which is certainly much higher than the 10 percent tax that West Virginia is set to implement. Regardless, Pennsylvanian regulators do not seem shaken by this. Reason being, the underground sports betting industry is already worth approximately $150 million which can only grow further through the legalization of the activity.
“They’re going to complain about it, but at the end of the day, they have a choice,” said PA Senator Jay Costa, the Democratic Senate Leader. “They can decide not to participate in this type of gaming. They are going to be 9 or 10 or 11 other entities that would participate here.”
There is, of course, a lot of time left for various stakeholders to deliberately discuss the terms. In fact, a win-win scenario might arise eventually since the state’s gambling regulator is set on implementing sports betting in the best way possible.
