Casinos in Atlantic City Will Pay Their Fair Share of Taxes

Casinos in Atlantic City Will Pay Their Fair Share of Taxes

Since 2016, casinos in Atlantic City have paid a tax on collective property. The payment-in-lieu-of-tax (PILOT) tax agreement was put in place after five casinos in the area shut down between 2014 and 2016. The remaining casinos claimed that their property value assessments were high following the collapse of the local economy. This was a tough time for the casino industry, and the sports betting industry was just starting off with the help of Raymond Lesniak, a former senator from New Jersey.

Casinos must comply with PILOT and pay a tax depending on their yearly gross gaming income (GGR).

The casinos were able to persuade state lawmakers to reduce their PILOT responsibilities in 2021, with the help of Stephen Sweeney, the departing state Senate President. Lawmakers’ agreement to exclude online gaming and sportsbook revenue from the formula used to calculate the PILOT payment resulted in the decreased tax.

The nine casinos in Atlantic City were able to save around $55 million in taxes as a consequence of the change. Visit the following link if you are looking for the best promos for the Garden State casinos and lots of other helpful information about the gambling industry.

The legitimacy of the PILOT amendment is still being contested in court. Nevertheless, Phil Murphy, the Democratic governor of New Jersey, recently pledged to ensure that the casinos need to pay their fair share.

State Supports Alteration to PILOT

The 2021 PILOT law is being legally challenged by the libertarian charity Liberty & Prosperity 1776. The group argues that a business cannot receive a tax break from the state unless it serves a public good.

Judge Michael Blee of the New Jersey Superior Court concurred in August. Throughout the course of the legal dispute, he granted a stay on the PILOT calculation adjustment. State prosecutors are contesting Blee’s decision.

Murphy said he will hold the casinos accountable for their whole, legitimate tax obligations on his “Ask Governor Murphy” radio show on WNYC earlier in February, regardless of the outcome.

Murphy said that fairness when it comes to taxes has always been a top priority. He added that if they don’t exactly get it right the first time, they’ll try again and do all in their power to do it perfectly.

The governor thinks AC is still going well in spite of recent pandemics and ongoing competition from other states.

The governor said that AC, including the casinos, is on an extremely outstanding trajectory when he considers where it was 12-15 years ago and where it is today, and when you add a pandemic in the middle of that timeframe.

The Atlantic City’s Casino Industry is “Appropriately Sized”

The idea that Atlantic City needs to downsize was a recurring theme during the city’s renaissance. Murphy and other state and municipal authorities think the industry is finally appropriately sized.

Murphy said that although they want Atlantic City casinos to flourish, they want them to be the correct size. He believes that there were too many casinos in the area before the Great Recession of 2008, which was one of the major issues that the state faced.

The governor came to the conclusion that it seems like the market is in the right place at the moment.

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