Indiana casino operators are so far more than satisfied with a recently-passed tax bill governing how casino funds will be taxed. The new tax law will help casinos increase competition while simultaneously allowing them to reinvest earnings into the state of Indiana as a whole. With that being said, not everyone is happy about the new law as local communities are unsure whether it will prove to be of any benefit to them.
David Strow, who operates a casino in Michigan City, commented on the passing of the bill by simply saying, “Boyd Gaming strongly supports House Bill 1350, which we see as a very positive step for Indiana’s gaming industry. It will provide our industry with stability from a tax perspective, and it will encourage additional re-investment in Indiana.”
The bill, which was officially signed into law last week, was welcomed by operators of casinos mainly because it phases out a currently existent add-back tax and institutes a wagering tax in replacement of an admissions tax. This is something that forces casinos to pay a percentage of their gaming revenue as tax rather than pay tax on the number of visitors to the casino annually. Essentially, this is a fairer way of taxing Indiana casinos.
Dan Nita, yet another gaming operator, commented on the unfairness of the add-back tax, and the fact that casinos are the only entities in the state subject to it. He said, “We are encouraged that the state is supportive of a few measures that will enhance the competitiveness of our casino operations. They recognize that no other business in the state is required to pay income taxes on other state taxes, which as we know, are quite significant.”
Because the $3 admissions tax that is currently in place is going away as a result of this bill’s passing, some local representatives are fearful that it may result in their communities receiving less money. The wagering tax will be better for casinos—and, by most accounts, fairer—and will help them buffer their bottom lines. Of course, Indiana casinos have promised that the extra revenue created by the bill’s passing would be reinvesting in local communities, however there are plenty of people who are doubtful of that.
It is said that the wagering tax is going to help casinos like Blue Chip. This is so because Blue Chip was hurt especially badly by the admissions tax, which charged casinos $3 for every head that enters the door. Blue Chip casinos made massive renovations that brought in a significantly larger number of visitors through the door. Though the new visitors brought in additional revenue, the $3 tax coupled with the costs of making renovations was seeing Blue Chip come out on the losing end.
There are stories like this coming from just about every Indiana casino, so it is no wonder that most operators are more than satisfied with the way in which the bill was drafted and passed. We will continue to keep a close eye on Indiana’s gaming industry to see what kind of affect this new tax has on revenues brought in by the casinos there.