Skepticism Pops Up As PA Lawmakers Discuss Sin Tax Revenue

January 3, 2017

Pennsylvania lawmakers were planning to hold a closed-door meeting today with casino owners intended to find solutions for, among other things, the state’s in-limbo casino host fee deemed unconstitutional by the Supreme Court of Pennsylvania.

Today, Berks County-based publication Reading Eagle published an op-ed rife with skepticism about state lawmakers’ ability to find a solution to what has become a drawn-out, highly publicized mess.

“It’s hard to imagine a better symbol for the leadership Pennsylvania has been getting out of Harrisburg lately than today’s planned closed-door meeting at the Capitol between lawmakers and representatives of the state’s 12 casinos,” the piece read.

“It’s a near perfect allegory for the irresponsibility of our leaders.”

The paper’s beef is indicative of large-scale dissatisfaction over the state’s handling of revenue-generating gambling expansion bills (statewide), as well as the host fee (certain counties and municipalities).

Chances have been many, successes few

The Reading Eagle’s stinging rebuke is indicative of a growing distaste for how lawmakers have handled multiple opportunities to approve bills:

  • The Senate approved a casino host fee solution and sent it to the House.
  • The House added the host fee provision to an omnibus bill that included regulations for online gambling and expanded slots use.
  • The House approved the omnibus bill and sent it to the Senate.
  • The Senate did not approve the omnibus bill during its end-of-the-year sessions.

The political wrangling was taxing enough as it stood at the end of December, but as Pennsylvania enters the third quarter of its 2016-17 fiscal year, another cost has become painfully apparent.

Failed bill cost state $100 million

The state believed the online gambling/slots bill would pass this past summer, so it included $100 million in tax revenue in the 2016-17 budget from the gambling expansion.

When the bill didn’t pass the Senate, the state was stuck with a $100 million debt that pushed its overall deficit to $600 million, or a 20 percent increase, because of the failed gambling legislation.

How much sin tax can the state take from its residents?

Lawmakers are searching every popular vice to find ways to raise revenue through taxes. The state’s cigarette tax went up $1 a box, a move projected to raise more than $400 million.

This past summer, the legislature approved a two percent tax increase on casino table games.

Pennsylvania already has a hefty conglomerate of sin taxes — its $2.7 billion revenue in 2014 led the country — and its 54 percent tax on slots is the highest in the nation.

If any major changes take place concerning the host fee, online gaming or slots, keep an eye out for Jan. 23, the next day that the Senate and House meet.

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