US Lawmakers Unveil New Framework For Regulating Online Gambling
The online gambling industry is changing quickly, and the US is a key part of this shift. Recently, US lawmakers introduced a new plan for internet gambling. Created by the National Council of Legislators from Gaming States, the proposal suggests tax rates between 15% and 25% and a ban on credit card deposits to help create better rules across different states.
The Evolving Landscape of Online Gambling in the US
Right now, seven US states—Connecticut, Delaware, Michigan, New Jersey, Pennsylvania, Rhode Island, and West Virginia—allow legal online casino games, while Nevada only allows online poker.
The new plan was created with input from lawmakers and experts in the gambling industry, including David Rebuck, the former head of New Jersey’s Division of Gaming Enforcement. He pointed out that the proposal matches current rules.
Rebuck stated, “Ninety-five percent of this mirrors what we’re already doing in New Jersey, which is good. It’s a great start that builds on what is already in place and operational elsewhere.”
Proposed Tax Rates and Their Impact on State Revenue
The proposed plan suggests a tax rate between 15 percent and 25 percent to encourage participation and ensure significant revenue for the states. This range matches the national average of 19 percent for online gambling, offering a more balanced approach compared to Pennsylvania’s higher tax rates of 54 percent for online slots and 36 percent for sports betting events.
The proposal also includes a ban on credit card deposits to help reduce the risk of gambling problems and excessive debt. It sets deposit limits, capping them at $20,000 within 24 hours, and gives certain state regulatory agencies the responsibility of overseeing betting operations.
West Virginia delegate Shaun Fluharty emphasized its potential to ease state budget pressures while encouraging responsible market practices. Fluharty said, “The thinking was we didn’t want to form a barrier to entry into the market with a high tax rate that only the biggest companies could afford.”
The new framework provides a strong starting point for states, but not all are ready to adopt it. Recently, Maryland’s attempt to pass new online gambling legislation was stopped due to critical circumstances. New York’s proposal of a 31.5 percent tax rate faced criticism, with concerns that it could discourage operators.
However, New Jersey’s detailed regulatory approach has set a standard for other states. By incorporating 95 percent of its framework, the proposal allows new adopters to use proven strategies.
Market experts predict a significant rise in legislative initiatives by 2025 as states look to online gambling to address fiscal challenges. The proposal offers a ready-made framework, simplifying the process of legalization.
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