Iowa Casinos May Obtain Gaming Income Tax Break

Posted on: February 26, 2024, 05:21h. 

Final up to date on: February 26, 2024, 05:21h.

Iowa casinos may see their efficient gaming tax lowered within the coming years if new laws finds favor within the Des Moines capital.

Iowa casino tax gaming revenue
Iowa Rep. Jane Bloomingdale addresses the state Home in March 2023. Bloomingdale is spearheading a push to decrease the state’s tax on gross gaming income incurred by industrial casinos, riverboats, and racinos. (Picture: Des Moines Register)

Iowa is dwelling to fifteen land-based industrial casinos, three riverboats, and one racino. The 19 casinos provide slot machines, desk video games, and sports activities betting.

Gross income from slots and desk video games is subjected to a graduated tax. Most fall beneath the best fee of twenty-two%, which applies to any on line casino that generates at the least $3 million in GGR in a given yr.

Iowa Consultant Jane Bloomingdale (R-Price) thinks with casinos opening in neighboring Nebraska, the state can be good to encourage its gaming licensees to make capital investments to maintain the Hawkeye State’s gaming trade aggressive.

“We’re decreasing taxes for people, we’re decreasing taxes for companies, however we’re not decreasing taxes for casinos. It simply doesn’t appear honest,” Bloomingdale stated.

Bloomingdale launched Home Examine Invoice 719 final week. The measure, if handed within the Legislature and signed by Gov. Kim Reynolds (R), would scale back the industrial gaming tax on slots and desk earnings over three years.

The research invoice already handed a Home Methods and Means subcommittee, which suggests the measure will quickly acquire a Home File quantity and obtain consideration from the complete committee.

Nebraska Gaming Begins

Except for 2020, Iowa’s industrial gaming trade has grown annually since 2014. GGR has risen from $1.39 billion in 2014 to $1.94 billion final yr.

Nonetheless, when sports activities betting income was excluded, legacy gaming — in-person slots and tables — in 2023 was down 1.2% year-over-year.

Nebraska is presumably the wrongdoer, as short-term casinos opened within the Cornhusker State. Iowa casinos in Council Bluffs suffered probably the most, as Nebraskans now have gaming choices with no need to journey throughout the Missouri River.

Mark Joyce, a lobbyist who represents the pursuits of the Diamond Jo casinos in Northwood and Dubuque, informed Radio Iowa {that a} tax break may assist Iowa casinos make renovations and amenity updates to compete with the brand new casinos in Nebraska.

It’s a really mature trade in Iowa and the newer casinos … in Nebraska are going to be model new,” Joyce stated. “They’re going to be taxed at 20% so for us to have the ability to have further capital to place again within the properties and higher compete for your online business [would be good].”

5 everlasting casinos in Nebraska are amid building in Omaha, Lincoln, Columbus, Grand Island, and Hastings.

Invoice Specifics

Bloomingdale’s on line casino invoice proposes lowering the on line casino slot and desk tax to 21% starting July 1, 2024. The tax fee would decline to twenty% on July 1, 2025, and right down to 19% efficient July 1, 2026. The 19% tax would stay in perpetuity.

The tax discount applies to land-based and riverboat casinos. The racino facility can be taxed barely increased — 2% greater than the charges for the casinos annually.

Iowa’s casinos have a robust lobbying presence in Des Moines.

The trade in June 2022 efficiently thwarted additional competitors by having the legislature and Reynolds approve laws that prevented the Iowa Racing and Gaming Fee from issuing new on line casino licenses for 2 years.

Nonetheless, the moratorium is ready to raise on July 1.

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