Local authority mulls over control of skill games, stepping up before state legislation.
Rewritten Article:
- Title: Erie, Pennsylvania Ponders Regulating Skill Games in Local Businesses
- Authors: Corey Sharp, PlayPennsylvania
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Last Monday, the north-eastern Pennsylvania town of Erie held a council meeting to discuss the potential regulation of skill games in local businesses. These gaming machines have created a stir due to claims that they effectively transform small businesses into tiny casinos, all while avoiding paying privilege taxes.
According to Erie's Borough President, Ryan McGregor, the machines have been cropping up all over town like mushrooms. A proposed ordinance focusing on businesses boasting a significant number of skill games is under consideration.
Though the Commonwealth Court declared skill games legal in December, their unregulated status leaves them operating in a legal grey area.
Small businesses across town are host to these controversial machines, much to the dismay of those, like McGregor, advocating for regulation.
What's the Inside Scoop?
As of now, skill games in Pennsylvania are in a gray zone. The Commonwealth Court ruled them legal back in December, but they're not yet part of the existing regulatory framework. However, the state is giving serious thought to establishing a definite legal standing and framework for skill games.
State Senator Gene Yaw is spearheading efforts to introduce legislation that would make skill games legal and regulated across Pennsylvania. Senate Bill 626 proposes a 16% tax rate and oversight from the Pennsylvania Department of Revenue. The Bureau of Liquor Control Enforcement would handle enforcement.[1][2][5]
Competing Interests
Commercial casinos, heavily regulated and taxed with a slot revenue tax rate of 54%, view the unregulated skill games as competition. The Pennsylvania gambling industry is against the expansion of skill games, citing concerns about undermining legit casinos.[2]
Future Outlook
Moving forward, it's expected that skill games might face tougher regulations and taxation. Their presence in commercial casinos isn't on the current legislative agenda. Instead, skill games are more commonly seen in small businesses like convenience stores and taverns.[3] Recently, Governor Josh Shapiro proposed a higher tax rate of 52% for skill games, a proposal not well-received in the current legislative environment.[4][5]
- The Erie Borough President, Ryan McGregor, has expressed concerns about the proliferation of skill games in local businesses, arguing that they turn small businesses into miniature casinos, without paying privilege taxes.
- The local casino-and-gambling industry, including commercial casinos, have expressed opposition to the unregulated skill games, fearing they undermine legitimate casinos.
- State Senator Gene Yaw is pushing for legislation (Senate Bill 626) to regulate skill games across Pennsylvania, proposing a 16% tax rate and oversight from the Pennsylvania Department of Revenue, with the Bureau of Liquor Control Enforcement handling enforcement.
- According to the current legislative environment, it's likely that skill games may face stricter regulations and higher taxes, such as the proposed 52% rate by Governor Josh Shapiro, but their inclusion in commercial casinos is not currently on the legislative agenda.
