Jackpot for Pennsylvania

Tax revenues exceed Nevada's.

The US state of Pennsylvania is challenging Nevada and New Jersey when it comes to slots action, it appears from Associated Press reports this week.

The news agency observes that the New England state collected more in taxes from commercial casino gambling than any other, including gambling mecca Nevada.

Pennsylvania's tax revenue from commercial casinos approached $1.1 billion in the fiscal year that ended June 30, The Morning Call of Allentown newspaper reported Monday.

Indiana was second with $878 million and Nevada third with $831 million.

A comparison by the American Gaming Association also showed Pennsylvania ahead in the 2009 calendar year.

Pennsylvania has just nine casinos operating, but its 55 percent tax rate on slot machine gambling more than makes up for it. By comparison, Nevada takes 8 percent from its 260 casinos.

Pennsylvania's casinos began offering table games this (July) month, putting further commercial pressure on neighbouring New Jersey's Atlantic City operations. Those (Penn.) games are being taxed at a rate of 16 percent and should bring the state $320 million more a year.

Gaming Control Board spokesman Richard McGarvey said Pennsylvania's high revenue isn't surprising. "Our tax is so high because the intention of the gaming law was to bring in tax money," he said.

Slot machine revenue has helped lower real estate taxes and prop up the state's horse racing industry. It has also helped pay for large civic projects like the expansion of the Pennsylvania Convention Center in Philadelphia and grants for volunteer fire companies.

Gary Tuma, a spokesman for Governor Ed Rendell, said a typical taxpayer has seen his bill go down about $190 per year, and senior citizens get even bigger breaks.

Pennsylvania's 55 percent tax rate on slot-machine proceeds is among the highest in the nation, but is below New York's 65 percent and West Virginia's 57 percent.

The Keystone State's high tax rate is not unusual among states that recently approved gambling, said a gaming industry analyst.

"A higher tax rate brings in more money, but that usually means fewer jobs and less capital investment," said Grant Govertsen, co-founder of Las Vegas-based Union Gaming Group, analysts for the worldwide gaming industry.

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