New York Introduces Online Casino Gaming Bill

New York State has taken the first steps toward legalizing online casino gaming by introducing a new bill by Senator Joe Addabbo. If passed, S4856 would legalize online casino gambling in the state and regulate it through the New York State Gaming Commission. Under the proposed legislation, applicants for a license would be required to pay a licensing fee of $2 million, with gross gaming revenue taxed at a rate of 30.5 percent. This is significantly lower than the 51 percent tax rate currently applied to sports betting gross income.

The bill would approve licenses for all nine online sportsbook operators currently operating in the state and the state’s four commercial casinos, racinos, and native tribes: the Seneca, Oneida, and Mohawk. Additionally, three competitive licenses would be made available for other online entities. Online casino gaming licenses would allow operators to offer online slots, table games, and live dealer games. However, the studio that houses and broadcasts the dealers must be in the state for live dealer games.

Proponents of the bill estimate that legalizing online casino gaming could bring in $800 million in annual tax revenue for the state, significantly higher than the $700 million in tax revenue received during the first year of sports betting legalization. However, getting the bill passed may prove challenging. Governor Kathy Hochul should have included online casino gaming tax revenue in her executive budget proposal for fiscal 2024, which could limit support for the bill. Without the governor’s full permission, the bill may face significant opposition and not pass.