Pennsylvania Sportsbook Operators Mobilize Against Potential Tax Increase
Online sportsbook operators in Pennsylvania launched a quick, unified offensive to stop any possibility of a tax hike on internet wagers. This intense reaction, dubbed an “avalanche of opposition,” began after the gaming industry learned the idea of raising taxes on online gaming and sports betting was included in recent state budget discussions. The industry feared the legislature would target online table games and sports betting for tax increases.
Industry System Responds to Revenue Discussions
The mobilization follows a prolonged budget deadlock in Pennsylvania, creating a deficit in the current budget framework proposed by Governor Josh Shapiro.
Republicans, who control the Senate, are concerned that spending the state’s $11 billion surplus and reserves will necessitate wide-ranging tax hikes in the near future. While Democrats argue the reserves should be used to fund state programs, the search for new revenue has placed online gaming in the crosshairs.
Online gambling in Pennsylvania currently operates under varied tax rates: online slots are taxed at 54%, online table games at 14%, and sports wagering at 36%.
Industry groups voiced concern that the state might raise the tax rates for the two lower categories—table games and sports betting. Last fiscal year, online table games generated $597 million in revenue, and online sports betting generated $459 million, making them significant targets for legislators seeking funds.
Political Action Committee Takes Control
Sportsbook operators responded to the threat with an immediate, multi-pronged campaign designed to apply political pressure. One group of operators announced they would commit at least $10 million to a new political action committee (PAC). This PAC’s sole purpose is to oppose any legislator who supports the proposed tax increase.
Simultaneously, major betting sites began airing advertisements that directly condemned the potential tax increase. Sports betting trade publications ran articles warning against the proposed hikes, and conservative tax policy groups published opposing editorials.
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