The Indiana legislature will not be legalizing online casinos for the state’s licensed casinos and their respective online/mobile sports betting partners this year. A legislative deadline for the legislation to clear the committee stage of the process was not met this week.
Last month, the state of Michigan kicked off a full menu of online gambling, including sports, casino, and poker. With only sports betting available via the web, Indiana is already starting to try to keep pace with its neighbor to the north. Online casinos for Indiana appear to be a matter of when not if.
It is a near lock that the legislation will hit the table again in 2022, though its chances are unclear.
Indiana is still in the process of implementing parts of the 2019 gaming expansion package that legalized sports wagering and authorized the construction of additional Las Vegas-style casinos. Including racinos and tribal sites, Indiana has 15 casinos, and another — Hard Rock Northern Indiana in Gary– is scheduled to open in the coming months.
A little over a year ago, Gov. Eric Holcomb indicated he would like to see implementation of that initial expansion package completed before bringing casinos to the web, but there’s no official indication that Holcomb had any role in the legislation failing to advance this session.
The fiscal analysis of the proposal estimated that Indiana online casinos could provide more than $100 million in taxes in their fifth year of being in operation. With a proposed 18% tax rate on their adjusted gross revenue, that would translate to an estimated iCasino market size of about $570 million annually.
“There is little data available on online gaming in the U.S.,” the fiscal note stated. “The legalization of online gaming in some states [has] provided information on the potential size of total and per-capita online wagers. Using data for per-capita online gaming and online gaming as a share of total statewide gaming from states where online gaming is currently allowed, a range of estimate was created for Indiana. It is estimated that the full impact of interactive gaming will be reached by the fifth year and generate between $286 million to $572 million annually in statewide AGR.”
For comparison, New Jersey’s mature iCasino gambling market was worth more than $970 million in 2020.
The fiscal analysis determined that Indiana could lose as much as $77 million each year in tax revenue off of gambling in retail casinos due to cannibalization.
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