Ohio is about to experience significant changes in online gambling. Brian Stewart, the Republican chair of the House Finance Committee, announced the introduction of House Bill 298 (HB 298), which aims to legalize online slots and card games (i.e., iGaming). However, the new regulations only allow existing physical casinos and racetrack casino operators in the state to participate, aiming to protect the local gambling industry.
iGaming, which refers to online gambling conducted via mobile phones or computers, has been gradually legalized in several states across the USA in recent years. Stewart stated that this move is the "logical next step" as Ohio has already approved physical casinos and opened up online sports betting.
Limited Access, Strict Market Control
HB 298 specifies that only currently licensed casino or racetrack operators in Ohio can apply for an iGaming license. Companies from outside the state are ineligible to enter the market. The initial fee for the license is set at $50 million, with an annual renewal fee of $10 million, and a tax rate of 28%, aligning with Michigan.
Marilyn John, a Republican representative and co-sponsor of the bill, pointed out that Ohio residents currently spend up to $6 billion annually on iGaming, approximately 85% of which occurs on illegal platforms. HB 298 is considered a pragmatic move to regulate the market, protect consumers, and create fiscal revenue.
Debate Over Revenue Usage
The bill is expected to generate between $400 million to $800 million in revenue for the state. During the hearing, two Democratic representatives proposed that these funds be specifically allocated for education and childcare. However, Stewart responded that the bill only allocates 1% of the revenue for problem gambling prevention, with the remaining funds going into the state's general fund, to be discussed by the legislature every two years when the budget is debated.
Promotion Restrictions, Favoring Physical Locations
To support local physical casinos, HB 298 also stipulates that promotional points offered on iGaming platforms cannot be used for online free games, but can be used for hotel, dining, or offline gambling activities at physical locations, aiming to redirect traffic back to the physical economy.
Currently, this bill represents the House version, and the Senate has also proposed similar legislation, which is awaiting committee hearing. As iGaming becomes increasingly seen as a "new gold mine" by more state governments, Ohio's move may prompt other state legislators to follow suit.
