Indiana iGaming could bring nearly $1 billion in new tax revenue to state
iGaming in Indiana could bring hundreds of millions of dollars in new tax revenue to Indiana almost immediately if lawmakers in Indianapolis legalize online slots and table games.
In May 2023, the Indiana Gaming Commission (IGC) hired Pennsylvania research firm Spectrum Gaming Group to study the impact of internet casino gambling. Spectrum recently submitted findings to state gaming regulators showing how much Indiana could benefit from allowing people in the state to gamble online.
Spectrum researchers concluded that Indiana would receive between $413 million and $929 million in new tax revenue over the first three years of iGaming. These numbers are averages for various tax scenarios that Indiana may impose on online casinos. Tax assumptions on iGaming’s gross gaming revenue range from 20% to 45%.
Tax projections are also based on how Indiana might approve iGaming. Possible regulatory scenarios include allowing only the state's 12 land-based casinos and riverboat casinos to operate online gambling platforms, allowing casinos to partner with multiple third-party iGaming operators, and allowing a fully open iGaming market where any company can apply without a physical presence Casino partner license.
No impact on current casino
Perhaps just as important as the tax benefits is determining whether iGaming will harm the state's current casinos. The Spectrum report noted that iGaming has been regulated in other states and that their brick-and-mortar casinos have not experienced a decrease in gaming revenue as a result.
Based on our analysis of iGaming in other states, iGaming does not appear to have a negative impact on other forms of gaming,” the report states. “However, previous iGaming results in other iGaming jurisdictions suggest that iGaming may be limiting casino retail sales normal growth of the amount. "
Connecticut, Delaware, Michigan, New Jersey, Pennsylvania and West Virginia currently allow online gambling for those of gambling age within their borders.
In New Jersey, the richest iGaming state, online casinos earned more than $1.9 billion from players last year. This was an increase of nearly 16% from the previous year and was the best year ever for the iGaming platform in the state.
Online gaming started in New Jersey in 2013. Last year, state lawmakers voted to extend the iGaming law for another five years until November 2028.
iGaming continues to thrive in New Jersey, while Atlantic City’s nine casinos are stabilizing. Revenue from stationary slots and table games exceeded $2.84 billion last year, up 2.2% from 2022.
iGaming Disadvantages
Spectrum said there are potential negative impacts of legalizing iGaming, including concerns that the ability to legally gamble on a computer or mobile phone could lead to higher rates of problem gambling. Spectrum cited a famous 2013 quote from late Las Vegas Sands founder, former chairman and CEO Sheldon Adelson.
‘Click your mouse and lose your house’ is not a marketing slogan for advocates of legalizing online gambling, but it should be,” Adelson said more than a decade ago.
There may be a strong possibility that Indiana will legalize online gambling soon. Last year, state lawmakers agreed to repeal all gambling laws by 2025. This comes after former state Rep. Sean Eberhart (R-Shelbyville) pleaded guilty to a federal corruption charge for agreeing to support gambling legislation that benefited a casino company in exchange for future jobs.
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Source: www.casino.org
