Whenever a new stream of income is introduced within a state based on legislation, the revenues generated will be placed in certain areas to help the state. Take for example lottery gaming. When states that offer the lottery passed legislation, they made requirements as to where a percentage of the revenues earned would go. In most states, the lottery helps to pay for education in some way. In Pennsylvania, one lawmaker is hoping to use sports betting revenues as a way to bring property tax relief to residents of the state.
Title 4 Amendment
Representative Tina M. Davis introduced an amendment proposal to Title 4 of the Pennsylvania Consolidated Statues in January that would see a portion of sports betting revenues go towards providing tax relief to property owners. The bill is currently in the House of Representatives awaiting review.
In Pennsylvania, sports betting is taxed at 36%. Of that amount, the majority goes towards the General Fund, 34% to be exact. The remining 2% is placed in a local share assessment fund. Ms. Davis is proposing that the 2% remain the same but the 34% be used in a Property Tax Relief Fund.
In her proposal, Ms. Davis pointed out that the goal of gaming was to provide property tax relief for residents in the state. And she is right. In 2006, the Taxpayer Relief Act was created which led to the Property Tax Relief Fund. In 2004, when casino gambling was first legalized, the state lawmakers said that revenues from gaming would mainly go towards providing relief from property taxes.
So far, revenues from table games and slots are sent to the Property Tax Relief Fund. However, changes as of late have led to new assessments of property in the state which would see tax rates going up. Property owners, particularly the elderly, are having difficulty affording their medication and food as well as pay for their property.
It will be interesting to see if the amendment is approved and the bulk of sports betting taxes go towards property tax relief instead of the general fund.