North Carolina is moving toward online sports betting in the final days of its 2022 legislative session.
The House Judiciary 1 Committee on Tuesday approved two bills that would allow up to 12 sports betting apps throughout North Carolina, where only in-person betting is currently permitted. The two went 6-3 with one abstention.
It will require the approval of the House Finance and Rules Committees (which will meet tomorrow) before a possible passage to the House. This must happen before June 30, or lawmakers will have to try again next year.
The first bill (SB 38) was recently introduced to complement the second bill (SB 688), which was passed by the Senate last year. It’s the proceeds of a deal that raises the proposed tax rate from 8% to 14% and doubles licensing fees from $500,000 to $1 million.
“I think it’s really an irregular way to pass a really substantial policy in our state,” Rep. Pricey Harrison said. “To do it that way, I can’t vote for this bill, but I appreciate you all amending it to make it a little more palatable.
disappointment and Amendments
Harrison said she planned to introduce an amendment to ban the use of credit cards to pay bets and ban betting on college sports, but “it wasn’t allowed.”
The committee unanimously approved a few amendments, including removing amateur sports from the definition of eligible events. He also included NASCAR in a list of recipients of a fund used to attract major sporting events. Representative Jim Perry, sponsor of the bill, said NASCAR was inadvertently left out of the original bill.
“I thought when I included amateurs, that included college sports,” Harrison said. “I would be much happier to see this bill proposed if I had been allowed to present these two amendments.”
Representative Abe Jones also voted against both bills, although he had different issues with them.
“Awesome, we’ll be the 36th state, whoopty doo,” Jones said. “Do we need money this way? To take advantage of drug addicts?”
Tax structure in question
Harrison also touched on the tax structure, which allows operators to deduct an unlimited amount of promotional betting income from their taxable income. She cited states like Virginia that saw poor revenue performance despite high betting volume.
“The house always wins,” Harrison said. “I can’t express how upset I am and what a terrible policy.”
Harrison pointed out that the North Carolina constitution prevents income taxes over 7%. She asked if a court could challenge the 14% gross gaming revenue tax proposed as part of her bill.
Perry’s staff responded by saying it might run the risk of being considered an income tax, but instead of the typical tax penalties, dodging the tax would only result in the loss of the ability to legally take Paris.
“This it looks like a clear delineation,” they said. “We made an honest effort to structure it so that if someone didn’t pay, they would lose a license.”
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