The State of New York is moving towards legalising online gambling. It will expand land based gambling by offering online gaming in the state. This will keep pace and catch up with the developments in the gaming sector in other nearby states such as New Jersey and Pennsylvania that already have online casinos. Currently more than 30 states have legalized some form of sports betting.
The proposed new bill has been filed in Albany and it will legislate online casinos. The amendments will not change the state constitution. Online table games such as blackjack and casino slots will be allowed once the bill becomes law.
The New York state constitution announced that it will provide “betting by virtual or electronic means” adding that the legislature will “declare an interactive gaming wager that is made through virtual or electronic means from a location within New York state and is transmitted to and accepted by electronic equipment located at a licensed gaming facility.”
Online poker will be available
In addition to the online casino proposal, a separate measure will be proposed to legalise online poker. Online sports betting has been booming in New York and so far has provided more than US$900 million windfall for state coffers. Regulators are expected to approve the most popular games such as blackjack and roulette as well as poker.
New York is the nation’s largest mobile sports betting market, generating more than US$16 billion in the state’s first 12 months with legal online wagering. Once the new proposals are rolled out, the state of New York is expected to be the highest grossing iGaming market. Currently the Canadian jurisdiction of Ontario reports the highest revenues in the sector.
Nine online sportsbooks in state of New York
The proposed bill will allow 14 mobile sites. Three casinos are also expected to be granted a licence this year. The State of New York currently operates nine online sportsbooks. The US market leaders in the sector are FanDuel, DraftKings, BetMGM and Caesars which combined have more than 80 percent of the market share.
Online casinos have higher margins for operators and tax revenues for the state than sportsbook. New York sportsbooks pay 51 percent of their gross gaming revenue (GGR) in taxes, the highest rate of any competitive sports betting market in the country, and are not allowed to apply tax deductions for advertising and other expenses incurred. The new bill would tax online casino gaming operators 25 percent of GGR.
A number of land based casino operators are opposing the new legislation. The bill is set to be heard in the company weeks.
Some resistance from land based operators
Online table games and slots are more difficult to legalize politically over fears in part that it will spur gambling addiction. Some brick-and-mortar casino operators have opposed these games as well over fears it would cannibalize revenues, but studies and revenue results from legal markets have shown these games are attracting younger customers and serve as a compliment to retail casinos.
In New York, the bill is set for a hearing in the coming weeks in the state assembly’s Racing and Wagering Committee. It will likely advance out of the committee, but it will likely face more pushback in the full Assembly and should it make it that far, the full Senate.