Recreational marijuana and sports betting legalization may be discussed in the legislative session in January, said Senator Paul Formica. Following the devastating COVID-19 impact, Connecticut state officials may be looking to raise fresh tax revenue from “sin tax”.
The Financial Impact of COVID-19 in the Constitution State
The COVID-19 pandemic has been spreading across the U.S. since March this year. The pandemic affected thousands of small and big businesses and resulted in thousands of furloughed employees. Furthermore, while some companies tried to retain their workforce intact, many employers had to take the difficult decision to lay off employees.
Connecticut wasn’t missed by both the pandemic and economic impact of COVID-19. With that in mind, state officials in the Constitution State may be looking for fresh tax revenue derived from “sin tax”. The so-called “sin tax” refers to the taxation of sports betting or other gambling activities. The taxation of recreational marijuana where the substance is legalized also contributes to the “sin tax” revenue.
Back in 2018, the Supreme Court’s ruling on PASPA, effectively allowed each state to pass its own sports betting legalization bill. But while some states such as Colorado already launched sports betting, Connecticut is still far from achieving this goal.
Keeping in mind the increasing budget deficit in the Constitution State, which may reach some $2.1 billion at the end of the fiscal year, talks about the legalization of sports betting and recreational marijuana have been reignited. Senator Paul Formica, who is also a member of the General Assembly’s Appropriations Committee said: “There’s going to be a big need for revenue.” He also outlined: “I’m sure there is going to be a big discussion on sin taxes in the long session starting in January.” Formica was referring to the 2021 session, which will begin on January 19.
Sports Betting and Recreational Marijuana Remain a Hot Topic in Connecticut
The legalization of sports betting in Connecticut remains a controversial topic. This is mainly because the tribes are arguing that they have exclusive rights to casino games in the state including the sports betting. Cited by News8, here is what Governor Ned Lamont said: “Online gaming is following every other part of our economy so I think it’s part of our future.” Although the Governor is showing support for the legalization of sports betting, the terms which were offered by his office were rejected by the tribal leaders. Connecticut tribes also stressed that since 1993, they have contributed approximately $9 billion to the state’s coffers.
The question about legalizing marijuana for recreational purposes in the Constitution State also raises multiple questions. This is because the state’s legislature is yet to determine how are the retail sales of marijuana going to be taxed. Another question that remains to be answered is how are the sales going to be regulated and who would be legally distributing the substance. Connecticut also faces the question of how would marijuana legalization impact the people in the state, who were previously convicted for use or distribution of the substance.
And while the legal hurdles surrounding recreational marijuana and sports betting in Connecticut continues, state officials still have a lot to debate. But keeping in mind the economic impact of COVID-19 and the needed tax revenue, we may be able to see how the situation will unravel pretty soon.