contributed photo The bill proposes lowering the graduated tax rate for casinos’ gambling gross revenue from 22 percent to 19 percent over the course of three years.

Lawmakers on an Iowa House panel approved a bill Monday to lower Iowa’s tax rate for licensed casinos, hoping to help the state’s 19 casinos compete with opening gambling facilities in the neighboring states of Nebraska and Illinois.

Rep. Jane Bloomingdale, R-Northwood, said the bill comes amid discussions of other tax cuts, including the governor’s proposal to speed up and further reduce Iowa’s individual income tax rate.

“We’re lowering taxes for individuals, we’re lowering taxes for corporations, but we’re not lowering taxes for casinos,” Bloomingdale said. “It just doesn’t seem fair. If we’re going to lower taxes for everyone across the state of Iowa, we maybe need to look at everyone.”

Lawmakers on an Iowa House panel approved a bill Monday to lower Iowa’s tax rate for licensed casinos, hoping to help the state’s 19 casinos compete with opening gambling facilities in the neighboring states of Nebraska and Illinois.

Rep. Jane Bloomingdale, R-Northwood, said the bill comes amid discussions of other tax cuts, including the governor’s proposal to speed up and further reduce Iowa’s individual income tax rate.

“We’re lowering taxes for individuals, we’re lowering taxes for corporations, but we’re not lowering taxes for casinos,” Bloomingdale said. “It just doesn’t seem fair. If we’re going to lower taxes for everyone across the state of Iowa, we maybe need to look at everyone.”

House Study Bill 719 would lower the graduated tax rate for casinos’ gross revenue from slots and table games. The current highest rate, 22 percent, applies to casinos that generate at least $3 million in gross revenue for gambling. Under the bill, the tax rate would decrease a percentage point for three years, ending at a 19 percent rate in fiscal year 2027.

Iowa currently has 19 casinos that offer table games, slots and sports betting. According to the Iowa Racing and Gaming Commission, gambling revenue in FY 2023 reached more than $4 billion, although both gambling and sports betting revenues decreased slightly from the previous year.

Lobbyists with Iowa casinos said that while their businesses are doing well in Iowa — and attracting many out-of-state visitors — lower tax rates in Nebraska and Illinois could put Iowa casinos at a disadvantage in future years. They said the tax cut would help Iowa gambling establishments stay competitive.

Rep. Mike Sexton, R-Rockwell City, asked how the lower tax rate would help Iowa casinos be more competitive. Doug Struyk, representing Great River Entertainment and Caesars Entertainment, which own casinos on Iowa’s eastern and western borders, said many out-0f-state residents visit Iowa casinos. But with a new casino opening soon in Omaha, places like Harrah’s and Horseshoe, both Caesars’ casinos in Council Bluffs, will be facing a “tremendous amount of pressure” to attract visitors to Iowa casinos, he said.

“It will to take additional investment in the facilities in Iowa to continue to be bright, shining new attractions, to keep people wanting to come over,” Struyk said.

https://iowacapitaldispatch.com/2024/02/26/lawmakers-advance-tax-cut-for-casinos/