Rhode Island legalizes sports betting with plans to take 51% of revenue
Rhode Island is moving ahead with its commitment to legalize sports betting at two casinos by 1 October, with plans to take a hefty 51% of the revenue.
RI Governor Gina Raimondo signed the $9.6 billion budget for fiscal 2019 on Friday.
Sports wagering is set to go live in October at two Twin Rivers Casinos, in Lincoln and Tiverton. The betting is expected to provide the state with $23.5 million up to July 2019.
Wagers will only be allowed from land based sources, with no provision in place for online betting in the current law.
International Game Technology (IGT) will be the sports betting technology vendor for Rhode Island, after being the sole bidder. The group has a long-standing relationship with the state, providing its land-based and electronic lottery platforms since 2003. It also has an office in the state capital of Providence.
In addition to Rhode Island taking 51% of the revenues from sports betting, 32% will go to IGT , leaving 17% for the casino. The state's high tax rate doesn’t sit well with some critics.
“High tax rates hinder the legal market’s ability to compete with shady, illegal operators that don’t pay taxes back to the state,” American Gaming Association Senior Vice President Sara Slane told Reuters.
The high tax may also have curb casino marketing and promotions.
“The relatively small share allotted for casinos means that those casinos have little incentive to market the product, which will dampen revenue potential,” Chris Grove, senior analyst for PlayUSA.com told Reuters.