RubinBrown Gaming Stats 2011

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State Gaming Tax Revenues

Commercial Gaming Tax Revenues by State

Consistent with overall commercial gaming revenues, state gaming tax revenues had mixed results in 2010. Of the 13 states that had commercial gaming in both 2009 and 2010, 7 states recorded increases and 6 states recorded declines in state tax revenues. However, most interesting is the fact that total taxes paid increased more than total revenue. In 2010 commercial gaming revenues increased by $99 million, or 0.34%, while the aggregate taxes paid increased by $182 million, or 3.41%. The larger increase in taxes paid is attributed to the substantial growth in states with higher tax rates, such as Pennsylvania. Prior to 2010, Pennsylvania claimed the highest tax rate with 55 percent of Electronic Gaming Device (EGD) revenues being paid to the state. In September, Maryland celebrated the opening of its first casino and began imposing a 67 percent tax rate on EGD revenues. In general, Midwest states impose a tax rate between 20-35 percent. Also noteworthy, only three of the 14 states charge an admissions tax on patrons entering the casino floor.

$1.3B

$867M

$433M

Iowa

Illinois

Indiana

Nevada

Kansas*

Missouri

Michigan

Louisiana

Colorado

Mississippi

Maryland**

New Jersey

Pennsylvania

South Dakota

2009

2010

*The first commercial Kansas Casino opened on December 15, 2009, therefore the percentage increase is not representative of a full year’s operations. **The first commercial Maryland casino opened on September 27, 2010, therefore no information to report prior to 2010.

National – Commercial Gaming Tax Revenues

Gaming Revenue Tax Rate

Description of Gaming Tax Rates

Colorado

0.25 - 20% Graduated tax rate from .25% - 20%, with all adjusted gross proceeds in excess of $13 million taxed at 20%.

Illinois

15 - 50% Graduated tax rate from 15% - 50%, with all adjusted gross receipts in excess of $200 million taxed at 50%, plus an admission tax of $2 - $3 per patron per gaming day. 15 - 40% Graduated tax rate from 15% - 40%, with all adjusted gross receipts in excess of $600 million taxed at 40%, plus an admission tax of $3 per patron per gaming day. 27% Gross gaming revenue tax of 27%, with 22% paid to the state, 3% to the locality, and 2% to the state problem gambling fund. 21.5% Riverboats incur a tax rate of 21.5% of adjusted gross receipts with additional local taxes determined by locality. Land- based casinos incur the greater of 21.5% of adjusted gross receipts or $60 million. 67% Gross gaming revenue tax of 67% with 48.5% - 51% to the Maryland Education Trust Fund, 7% to horse racing purse account, 5.5% to local impact grants, 2.5% to race track facilities renewal account, 2% to Maryland Lottery, and 1.5% to small, minority and women-owned businesses. 19 - 24% Permanent facilities pay a flat tax of 19% on gross gaming revenue, while temporary facilities pay a flat tax rate of 24%. In 2010 the one pre-existing temporary facility was converted to a permanent facility. 4 - 8% Graduated tax rate from 4% - 8%, with all monthly adjusted gross receipts in excess of $134,000 taxed at 8%. Additional local taxes up to 4% of revenues, as well as annual licensing and gaming device taxes. 3.5 - 6.75% Graduated tax rate from 3.5% to 6.75%, with all monthly gross gaming revenue in excess of $134,000 taxed at 6.75%, with additional local, gaming devices, regulatory, and entertainment taxes. 9.25 - 10.5% Gross gaming revenue tax of 8% plus either a community investment alternative obligation tax of 1.25% or an investment alternative of 2.5%. An additional tax of 4.25% charged on Casino complimentaries. 16% and 55% A gross gaming revenue tax of 16% is imposed on all table games, with 14% paid to the state and 2% to the locality. A gross gaming revenue tax of 55% is imposed on all electronic gaming devices, with 34% applied to property tax relief, 12% to the horse racing industry, 5% to the Economic Development and Tourism Fund and 4% to local government. 5 - 22% Graduated tax rate from 5% - 22%, with all adjusted gross receipts in excess of $3 million taxed at 22%. 21% Adjusted gross receipts tax of 21%, plus an admissions tax of $2 per patron per excursion.

Indiana

Iowa

Kansas

Louisiana

Maryland