PA House Approves Online Gambling Legislation

Published June 13, 2017 by Elana K

PA House Approves Online Gambling Legislation

On June 7, the Pennsylvania House passed a bill that would legalize online gambling and daily fantasy sports in the Keystone State.

On June 7, the Pennsylvania House passed a bill that would legalize online gambling and daily fantasy sports in the Keystone State, among other things. The bill won in a 102-89 vote, and now needs to go back to the Senate for final approval.

There are a number of issues, however, which threaten to block the bill's progress: VGTs (video gaming terminals) and the tax rate.

VGTs

VGTs have been a recurring point of contention in the Pennsylvania online gambling debate. The Senate bill did not make allowances for VGTs, which are essentially slot machines that can be played outside of casinos. The House’s bill would allow VGTs to be placed throughout the state - up to five in most places with a liquor license and up to 10 at truck stops and off-track betting parlors. 

VGTs could be a make-or-break issue when the bill returns to the Senate, where it was not approved of originally and has many opponents.

Tax Rate

The legislation that the House passed includes a 16 percent tax rate for online casinos, as opposed to the bill the Senate approved, which included a 54 percent tax rate. Most experts agree that a 54 percent tax rate would kill Pennsylvania's online gambling endeavor before it even got off the ground, but the Senate still needs to agree with the experts and pass the bill with the lower tax rate. 

The 54 percent rate was chosen because that’s how land-based casinos are taxed, but the Senate needs to come to the realization that land-based casinos and online gambling are different animals altogether.

Minor Differences

There are a number of minor differences between the House's bill and the Senate's bill, but the main challenge will be overcoming the issues of VGTs and the tax rate. Once these hurdles have been cleared, the path to Pennslyvania online gambling should be clear and smooth.

See also

PA's New Budget Includes iGaming as Key Revenue Stream

Pennsylvania Likely to Approve Online Gambling


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