New York online casinos could launch in the near future if a new Senate bill is passed. The bill was filed on Wednesday evening.
Bill S4856, sponsored by Senator Joe Addabbo, features a 30.5% tax rate on gaming operators. It is a far more attractive number than the current 51% tax rate on NY sports betting operators.
Each licensed sports betting operator in the Empire State would also receive a NY online casino license. This would go a long way in making the slow-growing New York market more profitable for online sportsbooks.
Once doubtful, prospects for NY online casinos improving
Things looked grim for online casino legalization in New York after it wasn’t included in Governor Kathy Hochul’s FY2024 executive budget proposal. But Howard Glaser, Light & Wonder global head of gaming affairs, believes the tax revenue New York would receive from online casinos would be a more welcomed revenue stream than taxing citizens.
Glaser told Legal Sports Report:
“The iGaming bill would raise in the neighborhood of $800 million in revenue for the state. This should be much more palatable to the legislature than the tax increases, like the commuter tax or the corporate franchise tax, that were proposed in the Governor’s budget.”
What’s in NY bill S4856?
The most important thing to note from Addabbo’s proposal is the 30.5% tax rate on online casino revenue. That also includes deductions from promotions, which should make the NY market desirable for new gaming operators.
The initial licensing fee is $2 million, and the license would be valid for 10 years. For operators renting a license under their own brand, a $10 million fee is required.
Each operator will receive a single online casino license. Games that the bill will allow in New York include: slots, tables games and live dealer games. Though, live dealer studios must be located in New York.
The NY State Gaming Commission will be the regulating body of New York online casinos. The commission will also be tasked with distributing $11 million of annual tax revenue to problem gambling education and treatment purposes.
Not the first bill aiming to legalize online casinos
In February 2022, Addabbo proposed a bill to bring online casinos to New York. Obviously, it didn’t get the proper backing to be enacted.
But Addabbo hasn’t given up in the fight for online casinos. After it was excluded from Hochul’s budget, even Addabbo admitted, “It’s not a good sign.”
But one distinctive difference between last year’s bill and the one proposed on Wednesday is the tax rate. The old bill called for a 25% rate, and the new one is a bit higher at 30.5%.
Besides that, the bills are generally the same. Time will tell if the increased tax rate is enough to get the thumbs up from lawmakers.
One thing we know for sure is proponents of the bill will push for it to make it to the floor and get passed before the legislative session ends on June 8. If it’s not approved before then, efforts to legalize online casinos will have to wait until 2024.
In a recent joint hearing, Addabbo said New York loses “roughly $4 billion” each year online casinos remain illegal. With that in mind, there’s no time like the present to make a change.