The Ohio Legislature’s Joint Committee on Gaming and Wagering recommended yesterday that the practice of un-taxed promotional freebies at racinos and casinos of Ohio should be reconsidered. Over $650 million in promotions by the gaming venues went untaxed, which legislators believe could have been used to assist local governments and the school districts of the state.
The committee created a strong report urging lawmakers to consider doing away with casino tax exemptions to protect the interest of taxpayers, state government and schools.
The report showed that a study conducted from 2012 forward showed claims by the gambling the industry that offering the free money for consumers increases the taxable income at the gaming houses are false. The analysis was conducted by State Senator William Coley’s office, and this study found there is no pattern between the overall revenue and how much money is spent on the promotional freebies.
The report further states that the study raises serious questions as to whether is wise to continue with the exemptions. Bob Tenenbaum, a spokesman for Penn National Gaming, stated that the operator is in opposition of the elimination of promotional spending tax credits.
According to Tenenbaum, Penn National believes any changes to the current tax credit for promotions would create a negative impact on the revenues of the casino and stifle the growth of gaming in the state. This would make it difficult for the state to stay in competition with neighboring states in regards to gaming. Tenebaum says any change in the promotional activities would drive visitors to Michigan, West Virginia, Indiana and Pennsylvania.
Currently, there are 26 individual states in the US that offer commercialized gambling and Ohio is only one of nine states that do not limit or tax promotional spending of the gambling venues. With Penn and Rock Gaming, tax exemptions were contained with separate memorandums of understanding with deals created in 2011 with then Governor John Kasich, two years after voters legalized casinos in the state.
According to the committee, the laws need improving. Even though the state has four separate entities that enforce the gambling laws of the state, the panel has found issue. Queen of Hearts, a jackpot game, has fallen through the cracks, not being regulated in the state. The panel has asked legislators to place the game under the casino commissions authority and then to study streamlining the oversight of the gambling industry with fewer agencies in charge.