Taxes Illinois casinos are required to pay to the state has proven to be a major hurdle for a gambling expansion bill (SB 1739) that’s currently sitting in the state’s House. Though there are still numerous issues that need to be ironed out, the tax structure has become the big elephant in the room. “The tax rate is the big one,” Rep. Robert Rita, D-Blue Island, lead House sponsor of the expansion bill, said earlier this week. “We’ve been working on it, and we’re sort of stuck at that.”
Casinos in the state are taxed depending on their revenues with those earning higher revenues facing bigger tax rates of as much as 50 percent. But the gambling expansion bill, which was already approved by the Senate, would include huge tax cuts for higher earning casinos, particularly those that earn between $200 million and $300 million a year. Instead of sending half of their revenues to the state, these casinos would only send 40 percent of their revenue. The only time a casino will be forced to pay 50 percent taxes is if they make more than $800 million.
But while the Senate seems to have agreed to this set-up, discussions are still going on in the House with negotiations centered around both the rates that are paid and and the time when these they will go into effect. In addition to this issue, the Illinois’ House is also discussing how some of these gambling revenues will be used by the state. When the Senate approved the bill, revenue allocations would have gone to economic development programs for Latino and African American areas, as well as agriculture programs, and repairs to the Illinois State Fairgrounds.
More discussions are scheduled to take place in the coming days before the spring session ends on Friday. Though pressed for time, the House is still confident that a compromise can be made so that the House can officially approve the bill.
One gambling legislation the Illinois House of Representatives did approve was Internet gambling on horse racing. The previous law had expired on Dec. 31, putting the handcuffs on the practice for the entire year. But now that the legislation has been approved, it now heads to the Senate for its own approval before being sent to the governor’s desk for the final call. Horse racing was a $122 million business in the state last year, which means that there’s a significant source of revenue that the state can use on numerous projects, including breathing new life to the struggling horse racing industry in the state.
As part of the legislation, the biggest share of the pie would go to a school construction fund with some of the money going to the horsemen and some being sent to the Chicago State University.
