Times are hard and more and more American states are contemplating balancing their budgets through tax revenues from online gambling. New York State is one of them. An item in OnlinePokerReport revealed that the Empire State budget proposal covered by Senate Resolution No. R4330 lists various options for funding an expenditure plan of about $150 billion. One of the options is legalizing, regulating and taxing online poker within the state.
This idea of Internet poker regulation is not a new one for the New York Senate. The legislative body had indicated that it could consider online poker revenues as a part of the budget plan of 2013. Back then the activity was not included in the final document. An online poker bill was later tabled in the Senate. It was sent to the Senate’s Racing, Gaming and Wagering Committee where it had a robust hearing in September 2015. In February 2016 it was passed with a unanimous vote and forwarded to the Senate’s Finance Committee for further consideration. It is pending there. There is a companion bill in the New York Assembly that also would lead to regulated online poker. It is common practice for state legislatures to move independent bills through the Senate and Assembly and later merge them.
Estimates of how much revenue could accrue to the state through regulated online poker were put forward to the Senate committee. The New York state online poker market could be worth more than $120 million in the first 12 months after launch. The bill proposes a tax rate of 15% on online poker operators. The operators would also have to pay $10 million for a 10-year license. The bill proposes that up to 10 licenses could be awarded.
The instance of regulating and taxing online gambling got a fillip in 2011 when the United States Department of Justice opined that intrastate online casino and poker gambling was not covered under the Wire Act. Since then New Jersey, Nevada and Delaware have legalized online poker and are beginning to benefit from the revenues it is bringing. But the path has been hurdled by opposition groups and vested interests. In New York, for example, there is a lobby that wants to delay online poker regulation till the new sanctioned brick and mortar casinos start operating. The lobby feels that licensed online poker sites could take away potential customer base and put the new land casinos in trouble even before they open.
