Digital Wager Wire highlights the most important events impacting the domestic and international sports betting and gaming industry each week throughout the year.
Ohio Proposes Twin Tax on Sportsbooks & iGaming Legislation
All states but one have a tax on sports betting revenues, while Tennessee taxes its sportsbooks on the handle (dollar volume wagered). Naturally, the betting handle is significantly more than the revenue, which is why Tennessee’s 1.85% on the handle is markedly lower than Ohio’s 20% tax on revenue.
However, one Ohio state legislator, Senator Louis Blessing, has proposed a twin tax that would include the prevailing 20% tax on revenues, plus an additional 2% on the handle. The legislators in Ohio have been reluctant to double the tax on revenues to 40%, as proposed by Governor Mike DeWine, particularly after he already doubled them from the initial 10% to 20% within months of the market launching in 2023.
iGaming Expansion Under Consideration
The Buckeye State is also considering an iGaming measure, which would make it only the eighth state in the nation, along with Rhode Island, Michigan, West Virginia, Delaware, Pennsylvania, New Jersey, and Connecticut, to allow online casino gambling.
Senator Ethan Manning’s online casino measure, Senate Bill 197, was heard for the second time last week by the Senate Select Committee on Gaming. Representative Brian Stewart introduced House Bill 298, his own piece of iGaming legislation, at approximately the same time.
Key Provisions in Manning’s Bill
Both bills are similar to each other, but Manning’s legislation has gained more traction and calls for the following:
- 11 licenses for the state’s casinos and racinos
- $50 million license fee
- 36% tax for Ohio operators
- 40% tax if an operator contracts with a management company
- $5 million renewal fee
- iLottery legalization
- Pari-mutuel horse racing wagering
Louisiana Considering Fixed Odds Horse Betting
Parimutuel wagering is the norm in horse racing, but it is a foreign concept to young sports bettors who are accustomed to fixed odds. When a bet is made on a horse, the final odds will not be tallied until the race goes off, giving the bettor a general idea of how much their winning ticket will pay them, but not an exact amount.
In other words, a horse may be 2-1 when a bet is made on it, but when the race goes off, those odds may move up or down depending on how much is in the pool of wagers and what percentage was wagered on that horse. But when betting on a sport, there are no such questions, as the line or the odds are locked in the moment a wager is made.
Fixed Odds: A Modern Alternative
The racing industry has considered adopting the fixed odds concept as it is more familiar to the younger generation of sports bettors, a demographic the industry would like to poach. Colorado and New Jersey have already launched fixed odds in their respective states, and West Virginia passed fixed-odds legislation earlier this year.
Now, Louisiana has become the latest state to consider it, as Republican Representative Chad Boyer has sponsored Bill 547, which would allow fixed-odds horse betting.
“Fixed-odds betting is already gaining traction in other states [and] allows a wager to be locked in at the posted odds, much like sports betting,” Boyer told the committee members. “By adopting this model, we not only offer a more competitive product to racing fans, but we also create a new revenue stream that will directly support our local racing associations through a dedicated purse supplemental fund.”
