Sports betting is less than two months old in Ohio, and things are going so well, Governor Mike DeWine wants to double the tax rate from 10 to 20 percent.
DeWine included the tax increase in his biennial executive budget proposal for the 2024-25 fiscal years. The Ohio Casino Control Commission (OCCC) will release official revenue figures at the end of February for the initial month.
A DeWine spokesman told PlayUSA that his other proposed reforms, which include changes to promotional credits and threats against athletes, are related to some sports betting proprietors and customers who have not followed the rules during the first month of Ohio sports betting.
“It is part of the package designed to encourage better compliance with the rules,” said Dan Tierney, press secretary for the governor. “Ohio is serious about enforcing the regulations passed by the Ohio General Assembly.”
The Ohio rules prohibit describing promotional gaming credits as “free” or “risk-free.”
The law also addresses threats of “violence or harm against persons who are involved in sporting events, where the threat is related to sports gaming.”
If a sportsbook owner does describe promotional credits as “free” or “risk-free,” the OCCC may ban the proprietor from providing promo credits in the future.
Last month, the OCCC issued $150,000 fines to BetMGM, Caesars and DraftKings for advertising promotions or bonuses as “free” or “risk free” and failing to properly display problem gambling hotline information in ads.
DraftKings could be looking at another $350,000 fine for sending mailers to people under age 21 in November. And Penn Sports Interactive was slapped with a $250,000 fine for Barstool Sports encouraging college students to preregister for the Barstool Sportsbook in October.
The House Finance Committee began to examine DeWine’s budget earlier this month. The committee will continue to look at the budget through June.
Rep. Bill Seitz told PlayUSA that he highly doubts the House will include the sports wagering tax increase in its budgetary bill.
“A low tax rate encourages legal play through regulated entities, which we prefer compared to illegal bookmaking outfits. Moreover, the betting has only been legal for a little over a month. So we don’t even know what kind of money the regulated entities are making.”
Eric Schippers, senior vice president for Penn Entertainment, agreed. Penn owns and operates two casinos and two racinos in Ohio.
“We believe a tax hike would have a negative impact on this nascent industry in Ohio,” Schippers said.
Could New York’s 51 percent tax be affecting DeWine’s thinking?
Ohio doesn’t have a similar marketplace. There are more online operators and a larger retail presence. Still, the Governor could be thinking the state could be making more money like New York.
