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iGaming as the biggest potential source of revenue for Pennsylvania
Wednesday May 7,2014 : IGAMING BIGGEST POTENTIAL REVENUE SOURCE SAYS PENNSYLVANIA STUDY (Update)
Most likely complement to land-based casinos
A report commissioned by the Pennsylvania General Assembly Joint Budget and Finance Committee in December 2013 was released this week identifying iGaming as the biggest potential source of revenue for the State.
The findings forecast that iGaming could yield $184 million in the first year and $307 million the next with direct tax revenues estimated to potentially yield $68 million in the first year, and $110+million annually thereafter. And estimates that online sports betting could yield between $100 million and $400 million in revenue of which tax would amount to around $25 million in the first year.
A conservative approach is suggested when setting tax rates for iGaming which would be slightly above land-based rates due to perceived lower operating costs in the online sector. The report suggests a 20 percent tax rate on online poker and 60 percent for online slot-style games but suggests those be phased in as the sector progresses rather than set at start-up.
On the issue of cannibalisation, the report found iGaming would compliment rather than cannibalise terrestrial casino revenues, providing synergistic marketing opportunities and an increase in terrestrial casino foot traffic as new gamers become comfortable with playing poker in particular.
The full report can be accessed at: http://lbfc.legis.state.pa.us/reports/2014/90.PDF
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