Pennsylvania’s restrictions on online and in-person gambling would be eased under a bill currently under consideration in the state Senate’s Rules & Executive Nominations committee, chaired by state Sen. Jake Corman (R-Centre County), the chamber’s majority leader.
After the state Senate amended House Bill 271 (HB 271), originally sponsored by state Rep. Jason Ortitay (R-Alleghany) in February, the House approved the revisions on June 7. The bill was assigned for full Senate consideration on June 12.
HB 271 would allow Pennsylvanians to play games of chance and skill on video gaming terminals in private establishments such as bars, restaurants, and bowling alleys. It would also legalize online poker and other gaming websites.
Businesses’ online casino revenue would be taxed at 54 percent, and revenue from online poker would be taxed at 16 percent, if the legislature approves the bill and Gov. Tom Wolf signs it.
Online poker sites enable people to play poker, a game of skill, against other people or simulated computer opponents, on the internet. In addition to poker, online casino gaming can include games of chance such as baccarat, blackjack, slot machines, and keno.
State Rep. George Dunbar (R-Westmoreland), a cosponsor of the bill, says legalizing and liberalizing gambling and gaming makes sense, and dollars too.
“There is a great deal of revenue tied up in HB 271,” Dunbar said. “It depends on the ala carte items—what gets selected and what doesn’t— but it could result in $100 million to $500 million a year,… not now, but in future years.”
Offsetting Social Costs
HB 271 provides additional funding for gambling addiction services, Dunbar says, to offset the potential social costs of gambling.
“In the bill itself, there is a great deal of money set aside for problem gambling and awareness, to address that as well,” Dunbar said. “I do get it: You’re tempting people who have a problem,… but is it fair to everyone else who doesn’t have a problem?”
Encouraging consumers to come in from the black market’s shadows should be an important goal when reforming gaming and gambling laws, says Michelle Minton, a consumer policy fellow with the Competitive Enterprise Institute.
“If they set the bar for licensees too high, players will continue to utilize unlicensed avenues, especially when it comes to online gambling,” Minton said. “Consumer protections, like banning underage betting, only work on the regulated market, so regulators should do everything in their power to make sure that those who want to gamble, want to gamble in the legal market.”
The Pennsylvania bill to reduce gaming regulations is good, but cutting the tax rates on gambling would be a further improvement, Minton says.
“It’s great that Pennsylvania finally recognizes that legalizing, regulating, and taxing the many forms of gambling already going on in the state is more beneficial than prohibition. However, the taxes and fees the state wants to charge are too high to push out the black market,” Minton said. “They should lower this tax rate if they want online gambling in Pennsylvania to flourish.”