Missouri Lawmakers Tangle Over Sports Betting Tax Rate

Date IconLast Updated: Sep 28th, 2022
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Missouri Lawmakers Tangle Over Sports Betting Tax Rate

As Missouri sports betting inches closer to being legalized, a conflict over tax rates has some lawmakers at odds.

In an executive session, the Senate Appropriation Committee approved sports betting legislation on Monday to legalize on-site and mobile wagering statewide.

The legislation, which received an 8-1 vote in committee, still has several steps to go before it would land on Republican Gov. Mike Parson’s desk for his consideration.

Senator Seeks Higher Tax Rate

Though approved in a Senate committee, the sports betting plan is still a “work in progress,” said state Sen. Dan Hegeman, R-Cosby.

Hegeman, the committee chairman, said the bill was approved to keep it moving, but that it is not the finished product, according to the St. Louis Post-Dispatch.

The senator has sought a higher sports betting tax rate than House Bill 2502 calls for.

If sports betting revenue is taxed at 8%, as the bill now stipulates, the state would collect $9 million annually, legislators said. But if that rate is bumped up to 21%, the state would bring in $163 million in tax revenue.

Any changes to the legislation in the Senate would have to go back to the House for another sign-off in that chamber before the legislative session ends May 20.

From there, the sports betting proposal would go to the governor.

Casino, Sports Teams Support Wagering

The sports betting legislation, sponsored by Rep. Dan Houx, R-Warrensburg, originally would have taxed sports betting revenue at 10%.

However, the taxation rate was lowered to 8% in an amendment on the House floor last month.

Without discussion, the House in March approved HB2502 and its companion, HB 2556, on a 115-33 vote.

In its current form, the sports betting proposal would legalize wagering at sports venues, such as Arrowhead Stadium in Kansas City, and the state’s 13 casinos.

Sports teams and casinos also would receive online platforms, called “skins,” allowing bettors to use mobile apps in wagering from anywhere in the state on professional and college sports.

Missouri’s professional sports teams have formed an alliance with the casinos in supporting sports betting.

At a recent Senate Appropriations Committee hearing, Steve Chapman, a St. Louis Blues vice president, said revenue that the smaller-market NHL team could generate from sports betting would help it compete with teams in New York and other larger markets.

Sports Betting Legal In Neighboring States

Among the eight states that border Missouri, sports betting is legal and live in Iowa, Illinois, Tennessee and Arkansas. It is legal but is not yet operational in a fifth neighboring state, Nebraska.

A bill to legalize sports betting in another bordering state, Kentucky, failed to win approval before the Legislature adjourned this month.

In Oklahoma, sports betting seems unlikely to win legislative support before the session ends May 27, according to key legislators.

Legislators in another neighboring state, Kansas, are expected to vote on a sports betting proposal before the session ends next month in Topeka.

In its current form, the Kansas sports betting legislation would create a fund to attract professional sports teams to the state.

The Kansas City Chiefs, whose Arrowhead Stadium, is only a dozen miles from the Kansas border, have said they would consider relocating after its lease expires in nine years.

Arrowhead opened in 1972. It is the third oldest stadium in the NFL, only behind the Chicago Bears’ Soldier Field and Green Bay Packers’ Lambeau Field.