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The State of Indiana Drops their Casino Fees Plan

On April 29, 2007, with the pressure from the state's casino market, the legislators scrapped the plan to charge costly fees for casino expansion, but allowed the casino facility to leave their casino boats in favor of building their gambling casinos on permanent barges.

Conditions have been temporarily added to the proposal that would allow about 2,000 slot machines on the 2 horse racing tracks in the state. The racing tracks must pay around $250 million in total fees for the chance. The proposal must be approved before its deadline.

Previously, the Senate Rules Committee passed a bill that would increase the taxes imposed on cigarettes up to 44% per pack and used the taxes for a health insurance program for low-income citizens. The legislators were also reviewing the state budget, the $26 Billion 2 year spending plan which puts more cash for schools, universities, Medicaid and state prisons.

It will also give $300 million in tax relief like tax rebate and around $250 million for homestead credit. The cash coming from racing track license fees will be used for property tax relief. Negotiators thought that they might earn more money for the tax cuts by allowing barge casinos and implementing fees for expansion plans because the Argosy Casino in Lawrenceburg and the Horseshoe Hammond in Lake County are already constructing new barges for their casinos.

Nonetheless, the legislators commented that the criticism from the casino lobbyist was so immense that it threatened to dismiss and with the bill any chance of a tax relief. So the new proposal that was discussed that day removed anything regarding allowing casino barges.

Nevertheless, the legislators added one provision to the bill that might force the state's highest earning casinos to pay more taxes in the near future. The casinos pay taxes based on a sliding scheme that starts around 15% and can reach as high as 35% for profits that are in excess of $150 million.

The proposal also states that any profit above the $600 million mark earned by the casinos will be taxed at 40%. The problem is that no casino has yet to earn above $600 million. Argosy was the highest earning casino boat with about $460 million from its customers.

 

Tuesday, May 15 , 2007
Edward O'Connor