Mississippi Moves to Raise Casino Taxes amid Online Betting Debate

The ongoing attempts to reshape Mississippi’s gambling landscape could result in a significant casino sector tax hike after the House Ways and Means Committee approved raising the levy from 12% to 16%. The motives behind this proposal lie in the Mississippi Senate’s unsuccessful attempts to legalize online wagering, costing the state significant missed revenues.

Mississippi Stands at a Crossroads

Ways and Means chairman Trey Lamar, the tax hike’s sponsor, argues that Mississippi is already experiencing widespread illegal online gambling without receiving any financial benefits. He argues that Mississippi could lose between $26 million and $80 million annually in potential tax revenue, estimating a more realistic figure of $50 million.

Online sports betting is already going on. A small handful of casinos are standing in the way of that legislation.

Trey Lamar, Ways and Means chairman 

Mississippi’s 12% casino tax allocates 8% to the state, while 4% goes to local governments and schools. Lamar’s proposal would increase the state’s share to 12%, potentially generating an extra $50 million per year. Mississippi’s low and stable tax rate has been a blessing for its casino sector. However, industry insiders acknowledge gambling revenues have stagnated as neighboring states adopt online wagering.

The proposal’s passage in the House further tightens tensions with the Senate, where opposition to online gambling remains strong. Senate Gaming Committee chairman David Blount criticized the proposed increase as an unfair burden on a vital industry. He was concerned that a 50% tax hike could drive businesses away from the state and have a counterproductive effect.

Online Wagering Remains a Divisive Topic

Earlier this month, the House overwhelmingly voted in favor of House Bill 1302 (HB 1302), which sought to legalize mobile sports betting. However, the proposed legislation faces stiff opposition in the Senate, where an opposing measure, Senate Bill 2510 (SB 2510), seeks to reaffirm the illegality of mobile betting while increasing punishments for violations.

Gambling expansion opponents argue that introducing online wagering could have significant societal costs and push individuals to spend more than they can afford. Retail industry representatives also fear that online betting will hurt their revenues. However, supporters argue that many people visit neighboring states to wager online or even engage with black market operators.

With billions of dollars at stake and conflicting opinions between lawmakers, casino operators, and online gaming advocates, the future of Mississippi’s gambling industry remains uncertain. While legalizing iGaming and online sports betting is likely a matter of time, the outcome of these discussions could have a lasting impact on the state’s gaming sector and the broader economy.