PA Skill Game Tax Plan Emerges Ahead Of Deadline
Pennsylvania state Rep. Russ Diamond has circulated a co-sponsorship memo proposing a two-bill package to regulate and tax skill games, as lawmakers face an Oct. 13 deadline set by the state Supreme Court to bring the machines into the state's gambling framework.
Diamond's co-sponsorship memo, filed Sept. 1, seeks support for legislation that would tax skill game gross terminal revenue at 20% and permit up to five machines at clubs, liquor-licensed restaurants and bars, and qualified truck stops. The same package would set a 49.9% tax rate on casino slot machines and all online casino games, down from the current 48-54% range for casino slots and 54% for online slot games.
Revenue would flow into the State Gaming Fund, with 79% earmarked for property tax relief, 13.25% to the General Fund, 6.75% to the Race Horse Development Trust Fund and 1% to the Compulsive and Problem Gambling Treatment Fund.
Why the Oct. 13 Deadline Matters
The Pennsylvania Supreme Court ruled in June that Pace-O-Matic's Pennsylvania Skill machines qualify as slot machines under the state's Gaming Act and criminal gambling laws, overturning lower-court decisions that had let them operate outside the regulated system.
The court stayed enforcement for 120 days, until Oct. 13, giving lawmakers a window to legislate before the ruling takes effect.
The Pennsylvania Gaming Control Board estimates between 70,000 and 100,000 skill game machines are currently operating across the state, spanning convenience stores, gas stations and other retail locations that would fall outside Diamond's narrower list of eligible venues.
An Unresolved Fight
Diamond's plan is the latest in a string of failed attempts to regulate skill games. Gov. Josh Shapiro has proposed a 52% tax with a 40,000-machine statewide cap in his last two budgets, while other lawmakers have pushed a 16% tax or a flat monthly fee per machine. Skill game regulation was left out of the $50.8 billion FY2026/27 budget Shapiro signed in July.
Reporting from Pennsylvania Capital-Star notes Diamond has not yet formally introduced the bills and is still seeking co-sponsors, meaning the package could still change before facing a vote.
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