Political Experts Betting Against Casino Tax Hike
Governor Corzine and his staff seemingly have floated every possible idea during the past few months to increase revenue and help solve the multibillion-dollar budget deficit -- hike the state sales tax, create a hospital-bed tax, boost the gasoline tax, raise the casino tax, etc.
Although New Jersey's 9.25 percent tax rate on Atlantic City casino gaming revenues is less than half that of many states, an increase apparently isn't in the cards. A casino tax hike was not part of the $30.8 billion budget submitted by Corzine in March. A variety of state lawmakers surveyed last week all agreed the tax is extremely unlikely to be raised, even as a result of next month's difficult budget talks.
And a bipartisan coalition of South Jersey politicians, casino operators and casino investors is determined to keep it that way. They all insist that those favorable tax rates are a major catalyst for the current building boom in Atlantic City. Even a slight uptick in the tax rate that was established more than two decades ago, they contend, could be financially disastrous for a state that currently collects just under $500 million out of a $5 billion pool of annual Atlantic City casino revenues.
"Just look at the level of investment this state enjoys, like the $600 million we're spending right now," Harrah's Chief Executive Gary Loveman said at last week's East Coast Gaming Congress at the Showboat Hotel. "You put in a high tax rate and you'll never see that again. All that job formation, capital formation and tax revenue growth will disappear as investors go everywhere else."
May 31, 2006
Posted By Susan Torres
Staff Editor, CasinoGamblingWeb.com
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