Ohio Online Casino Bill Introduces Steep Taxes for Operators

legalize online casino gaming in the state while implementing a tiered tax structure that varies based on the platform operators use. Senator Nathan Manning filed Senate Bill 197 (SB 197) on May 13, 2025, aiming not only to permit online casinos but also to regulate online lottery and horse race betting.

Tax Structure Favors Existing Casino Operators

PENN Entertainment —would pay a 36% tax rate. They would also be required to pay a $50 million license fee valid for five years, along with a $5 million renewal fee.

In contrast, companies using third-party platforms face significantly higher fees, with an initial licensing cost of $100 million, a $10 million renewal fee, and a tax rate of 40%. This elevated tax burden would make Ohio the state with the highest online casino tax rate in the U.S., suring Pennsylvania’s current 36% tax rate.

Additional Provisions and Player Protections

Beyond tax matters, the bill introduces several other key provisions aimed at consumer protection and advertising regulation. The retail sports betting tax rate would be cut in half, from 20% down to 10%. Advertising restrictions include a ban on using the word “free” in gambling promotions and a prohibition on placing gambling ads on college campuses. The legislation also mandates a range of player safeguards designed to promote responsible gaming.

Senator Manning expressed confidence in the bill’s revenue potential, estimating that online casinos could generate between $300 million and $1 billion annually for Ohio. The current bill designates 99% of tax revenue from online casinos to the state’s general fund, with the remaining 1% allocated to problem gambling initiatives.

Reflecting on the process, Manning commented, “We kind of put this together very quickly, but I will say we’ve been working on this for years,” emphasizing the extended effort behind the legislation.

Growing Political for Online Casino Legalization

Statements from Ohio’s political leadership reveal a growing willingness to embrace regulated online gambling. Senate President Rob McColley and House Speaker Matt Huffman have both indicated readiness to engage seriously with the bill, signaling a possible shift in state policy.

Huffman stated, “In some sense, I think as a state we’ve sort of turned the corner and said, ‘we’re going to raise money from gambling.’ … What I think public officials and most of the public recognizes is that people want services and they don’t want to pay taxes. And how do you solve that conundrum? One way is raise revenue in a different way, and one [of those different ways] is through gambling.”

Although Republicans McColley and Huffman the measure, Democratic Senate Minority Leader Nickie Antonio also showed interest, highlighting the importance of following other states’ successes with gambling revenue ing local services. “I think it’s important for us to look at,” she said, according to Statehouse News Bureau.

House Preparing Complementary Legislation

While SB 197 advances in the Senate, Ohio’s House of Representatives is concurrently developing its own online casino bill. Representative Brian Stewart, who chairs the House Finance Committee, is drafting legislation focused on raising state revenue through online gaming. This move follows the House’s removal of Governor Mike DeWine’s earlier plan to double the sports betting tax rate from 20% to 40%.

Source:

Ohio online casino bill would tax third-party operators more, sbcamericas.com, May 14, 2025