New York State Introduces Bill to Legalize Online Casinos
New York lawmakers are making a second attempt to legalize online casinos in the state. The bill, known as SB 856, is similar to the one proposed last year and would not only allow for the launch of online casinos but also permit the purchase of lottery tickets online. One of the key provisions of the bill is that it would allow sportsbook operators to seek an iGaming license, along with tribal and commercial casinos. Additionally, the bill proposes a 30.5% tax rate on operators, which is more favorable compared to the 51% rate for online sportsbooks in New York. Licensees would also be required to pay a one-time license fee of $2 million.
If the bill passes, any revenue generated from iGaming would go towards the state’s Lottery Fund, which primarily finances public education programs in the region. This is particularly important as New York has been facing financial pressures, with a projected budget deficit of $4.3 billion in 2024, which could double to $8 billion by 2025 according to some analysts. Senator Addabbo, a supporter of the bill, is optimistic that legalizing iGaming could help alleviate the deficit, estimating that it could generate as much as $1 billion for the state annually.
Despite the potential financial benefits, some lawmakers remain concerned about the social costs of allowing online casinos. They worry that problem gambling rates could skyrocket and negatively impact land-based casinos. However, supporters of the bill argue that there is already a significant amount of money leaving the state through offshore platforms, and legalizing iGaming could keep that revenue within New York while also not detracting from existing land-based casinos and lottery retailers.
The introduction of the bill in New York follows a trend of states across the US considering the expansion of online casinos. Currently, only six states have legalized iGaming platforms, with Rhode Island set to become the seventh in April. Advocates believe that legalizing online casinos would lead to higher tax revenue due to the healthier profit margins of these platforms compared to sportsbooks.
The bill’s proponents hope that lawmakers will seriously consider the financial benefits of legalizing online casinos while addressing concerns about problem gambling. If successful, New York would join a growing number of states embracing the expansion of online gambling, with potential significant implications for the state’s economy and public education system.