It is becoming increasingly apparent that gambling operators are benefiting greatly from taking their businesses online. Alongside, governments also gain since they are able to generate large amounts of taxes from the online gambling industry.
The casinos in New Jersey illustrate this point perfectly. The casinos in Atlantic City, the state’s gambling hub, have been losing money steadily over the past few years, and many of them have closed down in consequence. In fact, the iconic Trump Taj Mahal, long the cornerstone of the Boardwalk, closed down after a long bad run. However, the situation seems to be taking a turn for the better with land based casinos reporting increased revenues over the past six months.
Revenues from land-based casinos in New Jersey dropped by 7.6% on average every year from 2007 to 2015. However, this year saw a year-to-year increase, which last happened in 2006.
New Jersey’s Online Gambling Law
New Jersey’s online gambling laws require internet-based casinos to be run in partnership with land based operators. Since people have increasingly opted to gamble on the internet on account of the convenience, anonymity and cost effectiveness this medium offers, operators have been able to earn enough money to offset their losses from land-based gambling. More interestingly, the popularity of gambling sites is actually drawing people to land-based casinos to some extent.
Revenue officials in New Jersey also have much to cheer about since they are able to pull in increased taxes. People enjoy gambling tremendously, and they will visit offshore sites to gamble with the result that the state loses out on a lucrative revenue stream if an alternative doesn’t exist.
Online Gambling Available Only in Nevada and Delaware
At present, only Nevada and Delaware offer online gambling in the United States apart from New Jersey. Lawmakers in the state of Pennsylvania have been debating the merits of legalizing the industry but they are unable to come to a consensus. Other states that have also announced their intention to legalize online gambling include California, Illinois, Michigan, New Hampshire, New York, and West Virginia. There are indications that Hawaii will also follow suit.
New Jersey had legalised online gambling towards the end of 2103 but the initial response to it was lacklustre. However, the business started to pick up towards the end of 2016. As a matter of fact, 2017’s performance has given the industry much to celebrate. According to figures released by the New Jersey Division of Gaming Enforcement, total casino gambling revenue from January to April was $763.5 million, a 1.7% increase year on year. However, the revenue from online gambling was $80.1 million, a massive increase of 29.5% over the previous year. The state also earned tax revenues worth $3.1 million in April 2017, an increase of 23% over April 2016’s $2.5 million.
The Status of Online Gambling in Nevada and Delaware
Nevada and Delaware are permitted to offer online gambling. But they have not given the industry the attention it deserves. Nevada only permits internet poker and that too by just two casinos. On the other hand, Delaware permits a wider range of gambling, but only three casinos offer it.
State sanctioned online gambling conducted by licensed land-based operators is key to the industry’s growth. People have demonstrated a marked preference to take most commercial or entertainment activities online. Hence, it shouldn’t come as a surprise that they do the same for gambling. At the same time, tax revenues from land-based gambling throughout the United States have flattened over the past few years. It seems likely that Pennsylvania will be the next state to legalise online gambling. Even if it’s to reduce the state’s budget deficit, although lawmakers cannot currently decide on the right tax structure.