New Jersey Law to Allow Foreign Gambling Operators In
25th March 2014
A new bill has been approved by New Jersey Senate panel that will allow international online gambling companies to legally do business in the state.
In a positive move toward more liberalisation of online gambling, the New Jersey state Senate panel yesterday advanced an important measure that aims to allow international gaming operators to set up shop there. This would provide the facility to license and regulate foreign gambling operators in an attempt to increase revenue from the industry.
Putting New Jersey First
State Senator Raymond Lesniak (D-Union) has presented measure S9890 that effectively opens the doors to foreign companies while requiring them to locate in Atlantic City and partner with established casinos there. His reasons for putting this forward are to promote New Jersey as a leader in online gaming on both the home and international stages.
In a statement released by Lesniak, the senator said, "This could help make New Jersey the leader in online gaming, across the country and around the world. We could be the 'Silicon Valley' for high-tech gaming."
With expansion firmly in mind when he put this bill together, Lesniak has cleverly created the foundation where legislation would see Atlantic City casinos partnering with powerful international gambling operators to offer online gaming services to other countries or states where online gambling is legal. Of course this would require agreements to be signed by New Jersey with other states before it could become a reality.
By laying the foundation with this Bill, the ground work will be in place so that as more states approve online gambling (and this is becoming much more likely), New Jersey can be at the forefront of what is now a fledgling US online gambling industry.
Tax Acquisition and Growth
All foreign companies that gain approval and licensing from the state will be liable to pay the 15% sales tax on all Internet gambling. However, there will need to be a system whereby they gain credit for any taxes they have to pay to other countries where they are headquartered.
Estimates for the potential revenue that could be generated by this legislation stand at between $5bn and $8bn annually while creating between 11,000 and 16,000 jobs in the state. This is according to analysts Econsult Solutions, which has already provided an Internet trade group analysis.
Opponents of the move have questioned the potential tax revenue that has been cited as a major factor in approving this bill, suggesting that foreign companies would find a way to match the level of tax credits with what they pay to their countries of origin and thereby avoid paying any state taxes at all.
References: NJ.com
