Lawmakers in Ohio recently approved a measure that raised the state’s sports betting tax from 10 percent to 20 percent. The massive leap is, ostensibly, meant to help fight problem gambling while raising critical revenue for the state. Critics of the plan say the measure is too much and won’t actually offer any lasting benefits for the state.
At the heart of the issue is Republican governor Mike DeWine’s perception that sportsbooks are advertising too much in the state and are driving Ohioans to gambling problems. In his simplistic worldview, doubling the tax on mobile operators will leave them with less money to spend on advertising. As an added bonus, the governor believes the tax hike will increase the state’s from gaming revenue by upwards of $100 million annually.
Critics of the tax plan aren’t so sure that Governor DeWine’s plan will work, or even last. “The explanation given to me is we went along with the 20 percent but we fully expect the gaming study commission, which will be a bunch of legislators, would come back and say that the tax shouldn’t be 20 percent,” Rep. Bill Seitz told Legal Sports Report recently.
Seitz also added that the governor’s plan not only won’t curb problem gambling, and will likely drive some operators out of the state; decreasing tax revenues over time.
SBC Americas points out that Ohio currently has 18 operators of which four generate less than $100,000 in revenue. One Ohio operator is operating at a loss, casting more doubt on the effectiveness of the tax increase.
Ohio’s new tax on sports betting operator’s went into effect on July 1.