Tax Revenue from Online Gambling means its Momentum is unlikely to Diminish

Online Gambling

When it comes to balancing budgets, these are difficult times for those in the corridors of power across the United States. The unprecedented events of recent months have dealt a cruel blow to most industries, and states like Hawaii and Florida that rely so heavily on tourism have been especially hard-hit.  

There are, however, some causes for optimism, too. One sector that is in almost indecently good health is the legal gambling business. Casinos, poker rooms and sports books have never been in greater demand, especially those that are accessible online and via smartphones.  

Gambling revenue continues to rise and so do the tax dollars 

In 2019, commercial gaming revenue rose for the fifth year in succession to $43.6 billion. Figures have yet to be formally published for 2020, but you can be certain that the number will have risen again, and even more dramatically than in previous years. Thats a welcome piece of good news for the economy, especially when you take into account that it equates to more than $10 billion in tax revenue. 

The growth comes down to two factors. On one hand, technology is making gambling activities more accessible to everyone. Theres no longer the mystery that was once attached to a casino or sports book. The other aspect is legislative change.  

Just look at Pennsylvania as an example of a state that has pushed through numerous legislative reforms. In 2017, its new poker laws meant it became the fourth US state to introduce regulated online poker. A year later, the states first legal sport wager was placed, and since then, sports betting alone has generated tax revenue in excess of $140 million.  

More dominos will fall  

Whether we discuss casino gaming, sports betting, poker or all three, there is one common theme. States that have not legalized find themselves stuck between a rock and a hard place. On the one hand, they are staring at deficits that, in a state like Florida, run into the billions. On the other, they are fully aware that those who want to place a bet can easily go into a neighboring state and spend their dollars there. 

This year alone, it is anticipated that at least six states will pass new gambling laws. And every one of them that does so makes it more difficult for others to continue holding out. Ohio State Governor Mike DeWine put it perfectly earlier this year when discussing his own states new gaming bill, which is expected to pass into law by the end of 2021. He said that to all practical purposes, sports betting is already an established fact in Ohio. It is simply the case that the state is not regulating the activity or deriving any tax benefit from it.  

There are numerous other voices, both Democrat and Republican that echo Mr DeWines sentiments. Florida, Missouri, Connecticut, Alabama and Maryland are just a few of the states that are likely to join Ohio in rolling out new gambling laws over the coming months.