Summary: A representative in Pennsylvania has proposed an amendment to see sports betting revenue taxes go towards property tax relief.
In the United States, there are many different gaming industries available. From online casinos operating in the US and Internet poker, to the lottery and sports betting, most every state offers some form of gambling. When legislation is created to legalize gambling, rules and regulations are put in place to dictate how the industry will operate.
In the mix, the way the new industry will be taxed is considered. Many states choose to use such taxes to help support education, fund programs or clean up the state. In Pennsylvania, one representative is hoping to use the sports betting tax to provide property tax relief.
House Bill 498
In early January, House Bill 498 was introduced in Pennsylvania, sponsored by Representative Tina M. Davis. The bill has been sent to the House of Representatives for review and if passed into law, would provide property tax relief for residents of the state.
Based on Act 42 in the gambling expansion law passed in 2017, the state will take 36% in tax on sports betting revenues. Currently, six sports books are in operation. Of that amount, 34% will go to the General Fund of the state. The municipalities that host the betting venues will earn 2% which is being called a local share assessment.
With the new bill, Davis is proposing that the 34% be placed in a Property Tax Relief Fund. The 2% would remain the same. In her proposal, Davis points out that gaming was approved in the state with the intent of providing property tax relief for residents. She believes that expansions of gaming should see the tax relief provided for property owners in the state.
What Davis is referring to is the Taxpayer Relief Act, which was created in 2006. This act started the Property Tax Relief Fund. At the time, legislators made it clear that taxes from gaming revenues would go towards property tax relief in the majority. Revenues produced from slots and table games go towards this fund.
Fast forward to 2017, and voters in the state approved an amendment to the constitution that created legislation would stop property taxes altogether. However this would only happen if authorities such as school districts and counties found alternative options for property tax money. Such streams of revenue have yet to be found. However, Davis is suggesting that sports betting be the source.
Oddly enough, areas in the state are actually creating new assessments of property and homeowners will actually see a tax increase. Davis has noticed the increased property taxes and has voiced her concern with the new bill proposal.
Rep. Davis has pointed out that homeowners are facing rising property taxes and seniors on fixed incomes are having serious issues with the change. Davis feels that because of the problems surrounding property taxes, public officials have to do something to provide property tax relief for citizens.
Now, it is up to lawmakers to decide if they want to approve the change and provide such relief to taxpayers or keep the tax payments the same. It will be interesting to see how this plays out and if lawmakers choose to help their constituents.