A New Jersey lawmaker wants to raise taxes on online gambling operators in the Garden State.
State Sen. John McKeon, D-Essex/Passaic, introduced a bill to increase the tax rates on NJ online casinos and NJ online sportsbooks to 30%. That is nearly double the current amount paid by digital gambling operators.
McKeon, vice chair of the Senate State Government, Wagering, Tourism & Historic Preservation Committee, could not be reached to comment before publication.
Proposal to raise operator tax rates contains few reasons as to why
McKeon’s proposal was first reported last week by Legal Sports Report. At the time, no details were available since the bill’s text had not been posted.
PlayNJ obtained a copy of S3064 via the Office of Legislative Services on Tuesday morning. The three-page document does not include a reason or explanation for the proposed legislation.
Online casino, sportsbook taxes add billions of dollars to state coffers
As it stands, NJ online casino revenue is taxed at a base rate of 15% plus another 2.5% that goes to the Casino Reinvestment Development Authority, bringing the effective total rate to 17.5%. Online sports betting is subject to a 13% base tax rate plus an additional 1.25% for an effective rate of 14.25%.
In the 10 years and three months since online casinos first launched in NJ (November 2013), the state has collected more than $1.36 billion in taxes. Since mobile sports betting went live in the summer of 2018, NJ has recouped over $438 million in taxes.
Neither of those figures includes the additional tax rates mentioned above.
Increased tax rates would keep pace with neighboring states
McKeon’s bill would put NJ’s online gambling revenue tax rates on par with its neighbors.
Pennsylvania taxes online table games at 16%, online slots at 54% and internet sports wagering at 36%. New York taxes online sports betting at 51% of gross revenue. The Empire State does not have legal online casinos, but the most recent bill proposal included a 30.5% rate.
McKeon is serving his first term as a state senator. He spent the previous 21 years as a member of the state General Assembly.