NJ iGaming Tax Revenues Now Exceeds $100 Million

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Thursday, July 6th, 2017 | Written by Stephen Smith

New Jersey has generated $100 million in tax revenue since online gambling legislation was passed in 2013, sending a clear message that a well organized regulated market can make a significant contribution to a state’s coffers. The landmark point was finally achieved in May after New Jersey’s online gambling revenue hit $21.1 million, pushing the state’s overall tax receipt to $101.25 million, representing a definite win for the Garden State.

$20M Monthly Average

The new monthly average for New Jersey is $20 million in online gambling revenue, which was generated in each of the last three months, with May’s total coming in at $21.1 million, April’s at $20.8 million, and March’s at $21.7 million. Furthermore, while May’s revenue was higher by 37 percent compared to the same month in 2016, the revenue it produced last month was just a little short of the revenue record set a couple of months earlier in March.

Consequently, the hard facts are now apparent for even hardened anti-gambling advocates to appreciate that online gambling is proving to be a valuable new source of revenue for the benefit of Garden State residents. Commenting on the positive financials, PlayNJ.com senior analyst Robert DellaFave, stated:

“Even naysayers cannot deny the impact of New Jersey online gambling, which has now contributed more than $100 million to state coffers. New Jersey’s online gambling industry may be the state’s only new revenue stream to both generate more than $100 million in tax dollars and to do it without placing a heavy burden on citizens.”

Land-Based Revenue

In terms of land-based revenue, New Jersey’s casino industry brought in $229 million in May, representing a 4.3 percent improvement versus the same month a year earlier. Back then, the Trump Taj Mahal was still in operation, and if the casino’s results are removed from the latest figure, New Jersey would have actually recorded a 12 percent increase in revenue overall .

Leading New Jersey’s casinos market in May was the Borgata, with business up by 10.6 percent to $71.8 million, followed by Tropicana up 21.5 percent at $32.8 million, while Harrahs noted a slight 0.2 percent gain at $29.5 million. Meanwhile, Caesars noted its highest growth in quite some time, with revenue soaring by 23.6% to $29.4 million, the Golden Nugget boasted a 17 percent increase to $24.5 million, and the Resorts saw its business improve by 9.8 percent to $15.3 million.

Positive Outlook

Going forward, David Rebuck, director of the Gaming Enforcement Division, says that he feels optimistic about the potential of New Jersey gambling market, and its great performance up until now. Furthermore, being on the brink of a busy summer, the casino industry in the Atlantic City seems to be nicely positioned to take full advantage of the positive trends and variables being demonstrated. As Matt Levinson, chairman of the new Jersey Casino Control Commission, explains:

“That’s a great start to the summer. With all of the events planned around the city for the summer, I anticipate we will see casino revenues continue to increase.”

Sports Betting Possibilities

New Jersey is also hoping at some stage to add sports betting to the gambling products it offers in state, with the Supreme Court announcing this week that it would hear New Jersey’s case to decide whether the Professional and Amateur Sports Protection Act (PASPA) is actually legal or not. A win by the Garden State would then lift the flood gates for other states to also legalize sports betting, in the process lifting Nevada’s virtual monopoly of the industry. In fact, a number of states have already have bills in place to legalize sports gambling if PASPA is repealed, including Connecticut, Hawaii, Maryland, Michigan, New York, Pennsylvania, South Carolina and West Virginia.

Another factor that may sway the decision New Jersey’s way is the fact millions of Americans make sports wagers every day via unregulated, offshore sites, representing a major opportunity missed for domestic companies. There has also been a recent softening in the usually hard nosed approach on the issue by major sporting bodies, which could also bode well for a potentially positive outcome.