Missouri fights over sports betting tax rate

The State of Missouri is pressing on with the attempts to legalize sports gambling in the jurisdiction but one issue persists. State legislators are still not entirely certain how to figure out the tax levy and after heated discussions on Monday, the matter is still up for debate. The Missouri Senate Governmental Affairs and Fiscal Oversight Committee did not let this final detail throw a spanner in the legislative machinery, moving the bill ahead, but arguing that a tax rate must be defined and quickly.

The proposed draft, HB 2502, outlines how sports gambling will be licensed and where. Presently, the bill wants to establish casinos as venues eligible for offering both retail and mobile sports betting by teaming up with third parties. Online gambling will only be available to people who are physically based in Missouri, with geolocation software used to lock out any transactions from across the state border.

Lawmakers have been citing the strong potential of sports betting as the reason to move forward. According to analysts, as much as $10 million can go to the state’s educational system. However, without a final decision on the tax rate, this is difficult to predict. Sponsors and backers of the bills have urged fellow legislators to move along with the project lest Missouri becomes the last state in the region to benefit from sports gambling.

However, Sen. Denny Hoskins, wants the house bill changed. He pitches a counter-proposal that will result in the collection of $163million for the state annually. That’s a lot more than the $10 million proposed by the current version of HB 2502.

This money, Hoskins says, can be used for a range of activities, including education and supporting veteran homes. Hoskins is also aware of the challenges of supporting problem gamblers. He argues that the state spends some $250,000 on tackling gambling addiction, but realistically, the state would need to spend much closer to $4 million or $5 millionannually to fully address the issue.

Once sportsbooks are legalized, Hoskins is sure that the problem will increase, hence the need for additional tax revenue. HB 2502 sponsor Rep. Dan Houx has argued that what the end tax rate would be would depend on the state’s needs in addressing mental health problems. Eliciting $163 million from sports betting tax, though, seems like a remote possibility from a state such as Missouri, unless lawmakers choose to stifle competitiveness through high levies.

Image credit: Unsplash.com