A Proposed Senate Bill in New Jersey Would Double the Tax Rates on Online Sportsbooks and Casinos
A politician from New Jersey wants to increase taxes on the Garden State’s online gaming companies.
The D-Essex/Passaic state senator, John McKeon, has sponsored a measure that would raise the tax rates on online sportsbooks and legal casinos online in NJ to 30%. That is almost twice as much as what online casinos already pay.
Before publishing, it was not possible to get in touch with McKeon, vice chair of the Senate State Government, Wagering, Tourism & Historic Preservation Committee.
There Are Not Many Justifications in the Proposal to Increase Operator Tax Rates
Legal Sports Report was the first to report on McKeon’s proposal last week. Since the text of the law had not yet been uploaded, no information was available at the time.
But now that it is out there, there is no justification or explanation provided for the proposed changes in the S3064.
Taxes on Online Casinos and Sportsbooks Bring in Billions of Dollars for the State Budget
Currently, NJ online casino earnings are subject to a 15% base tax plus an additional 2.5% to the Casino Reinvestment Development Authority, for an effective total tax rate of 17.5%. The 13% basic tax rate on online sports betting is accompanied by an extra 1.25% tax, making the effective rate 14.25%.
The state of New Jersey has received more than $1.36 billion in tax revenue in the ten years and three months since the first online casinos opened for business in November 2013. In the summer of 2018, NJ legalized mobile sports betting, which has already brought in over $438 million in taxes.
The extra tax rates discussed above are not included in any of those calculations.
