The measure’s fate will be decided by December when the legislative session ends
New Jersey lawmakers want to drastically raise the iGaming tax, mirroring the high taxation rates in other states where online gambling is legal. Under Senate Bill 3064, New Jersey’s tax for online gambling would skyrocket to 30%.
For reference, online casino operators in the Garden State currently have to pay a tax of 15% plus an additional 2.5% Casino Redevelopment Authority fee. Online sports betting tax, on the other hand, currently stands at 13%.
Senate Bill 3064 was formally submitted by Senator John F. McKeon on April 8 and was referred to the State Government, Wagering, Tourism & Historic Preservation Committee.
The measure’s fate will be decided by December when the legislative session ends, providing it with enough time to advance. If approved, the new tax rate would take effect from January 1, 2025.
The 30% tax would bring New Jersey closer to other states where online gambling is illegal. For reference, Delaware taxes online sports betting at a rate of 50%. New York, on the other hand, goes a step further, keeping a whopping 51% of online sportsbooks’ revenues. Pennsylvania, which offers both online betting, online slots and online table games, taxes these verticals at 34%, 54% and 16% of their revenues, respectively.
Other States Are Also Eyeing Tax Changes
New Jersey, however, is not the only state proposing gambling tax changes. Earlier this year, Illinois’ Fiscal Year 2025 budget envisioned an increase of the state’s sports betting tax from 15% to 35%. The tax hike is yet to be implemented as of the time of this writing.
Last year, Ohio increased its sports betting tax from 10% to 20%. Later proposals sought to reduce the tax rate once again and provide some relief to the industry but failed to gain traction.
Elsewhere, a bill proposed the reduction of the tax rate for land-based casinos in Illinois.
In other news, a New Jersey Senator is currently seeking to introduce a prop betting ban, in line with the NCAA’s calls for the prohibition of such products.
Casino workers in the state, on the other hand, continue their fight for a smoke-free workplace. Unfortunately, their efforts recently faced a significant setback.
