New Casino Tax Fee Plan Introduced in Pennsylvania

by Kyle Miller

Pennsylvania State Senator Pat BrownePennsylvania State Senator Pat Browne has proposed tax credits to casinos in exchange for continued payments of $10 million in host community fees.

The state of Pennsylvania is currently considering several aspects of gaming expansion on top of having to determine what to do in regards to the host gaming tax. For months now, the state has been back and forth on the matter, with plans being created but nothing approved. The state has until the end of May to come up with a solution on the matter of the host tax fee before the state Supreme Court decision on the matter comes in to effect. Now it seems one state senator has a plan that might work.

A Little Back Story

Let’s go back just a bit to have a better understanding of what is taking place. In September, the state Supreme Court ruled that the host community tax was unconstitutional due to smaller casinos paying a different amount in taxes when compared to the larger gaming venues. Basically, casinos had to pay a $10 million flat fee or 2% of slot revenue earnings each year to the host community, whichever amount was the highest. For smaller venues, it was much harder to come up with the $10 million as they would never see a higher amount of the 2% in slot gaming revenues. Such casinos as Mount Airy felt this was unfair and took the matter to court. The state Supreme Court ended up ruling in the venue’s favor.

State lawmakers were given until the end of January to come up with a solution. Months went by without any plans but as January approached, lawmakers got to work. However, nothing was decided and lawmakers asked for an extension in the time frame for considering a solution. The court granted the extension and now the state has until the 26th of May to come to some decision on the matter.

Senator Pat Browne’s Idea

State Senator Pat Browne has now proposed a plan that could be a solution for the tax issue. The republican would like to see tax credits given to the casinos in exchange for the $10 million host fee. According to Browne, the $10 million fee could still be paid but the tax credit could be seen as a way to offset the cost of the payment.

The proposal by Browne would help to see the counties in the state continue to see the benefits of casino gaming. The state has 12 gaming venues of which half are located in suburban areas. The other half are located in busy cities such as Philadelphia. The proposal has not been formally introduced by Browne but the senator has stated he believes the tax credits will be a satisfactory solution for gaming companies.

This is not the first idea to be suggested in regards to the host tax. One plan was to remove the 2% slot stipulation while others wanted to see a complete overall of gambling in the state and expand in several areas to bring in more revenues.

Legislation created by Representative George Dunbar, House Bill 392, would legalize daily fantasy sports and online gambling plus allow for slot gaming to take place in airport terminals. Every plan suggested seems to have come upon some point of contention by some group or individuals in the process. The state really seems no closer to a plan of action than they were months ago.

If Browne were to introduce legislation it might be a simple way to keep the money in the state and help casinos stay afloat. We will have to wait and see if the Senator creates the bill and introduces it for consideration.