New Jersey Gambling

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Updated: May 2, 2018

Waiting?

Stop me if you have heard this one before, another circled date has passed and still no Supreme Court decision. April 30th was circled by many as a logical target date for the Supreme Court to issue an opinion. That date has come and gone and we are still left waiting for the decision that could shape the sports gambling world going forward. New Jersey lawmakers anticipating a favorable decision have bypassed waiting for the decision and laid out a bill that would address the states gambling regulation going forward.

Sports Betting Regulation

In the event that the state is victorious, New Jersey could be left with an unregulated gambling environment where everything could go. Three Democrats in Jersey, Eric Houghtaling, Joann Downey and Assembly Appropriations Chair John Burzichelli look to get ahead of the curve and lay the groundwork for how the state will operate. Not only will this legislation dictate how New Jersey will operate going forward but could also set precedence for other states that are sure to follow in the event the Supreme Court opinion is favorable.

What Does the Bill Look to Do?

Written by politicians, the bill itself is a word heavy mess that is tough to get through. Within its text  however are several important factors to read. Regulation of sports betting would be the responsibility of the NJ Division of Gaming Enforcement (kinda makes sense). A few additional key points from the bill.

Who can offer betting?  What can be bet on?

The state will allow wagering at any local casino or racetrack in the state.  A big addition would be that it would also allow wagering via mobile apps.  So basically, anyone in the state will have access from the comfort of their living room, car, or wherever they so desire. However, providers wishing to offer the mobile gaming platform must have an actual physical presence in the state. This will stop many of the outsiders or offshore providers from entering the market (wouldn’t want competition).

Wagering is banned on any college event that takes place in NJ.  Betting on any local collegiate teams is also prohibited. Fans of Rutgers, Seton Hall and other local squads will have to get their action elsewhere.

Tax Time

Now for the tax portion, why the states were interested in the first place. Gross revenue from sports wagering at casinos and tracks will be subjected to an eight percent tax (Nevada charges 6.75%). A higher amount of course as it will be a new product.  Here’s where the greed really sets in. Online sports wagers revenue will be taxed at a rate of 12.5%.  Yes, you read that right, 12.5% tax on revenues generated.  This is in addition to the federal tax of .25% that you have to imagine will be added to the bottom line as well.

On top of higher taxation, the bill also includes an integrity fee for the sports leagues. The increased viewership, potential lucrative sponsorship deals, and overall popularity were just not enough.  The leagues will have an integrity fund set up where funds will be set aside on an as-needed basis. The fee will be the lesser of $7.5 million of 2.5% of gross gaming revenue attributed to sports.

What Will We Finally Get?

Had really hoped gambler’s in New Jersey were going to get a fair shake. After all this was going to be the group that championed the cause and would set precedence for other states going forward. What we have here initially, however, does not look good for those looking for action. This piece of legislation fully outlines how greed will drive the state.  I’m guessing what we end up with is a very expensive vanilla product that caters only to those dull enough to not notice and the true degenerates among us that can’t help themselves.