Maryland doesn't understand the slots business

June 29, 2012

A casino is an entertainment business, and slots players are customers who visit to be entertained. Slots and card players know full well that the odds are against them leaving a casino with more dollars than they brought to play with. A slot player's entertainment is in the time spent playing, and that time is directly related to a casino's slot payout percentage.

Casino state taxes are an expense that directly impacts operations and customer charges. Casinos in Nevada offer the longest playing slot times by providing customers with a 95 percent slot payout made possible by a 7.75 percent casino tax rate. New Jersey comes in second with a casino tax rate at 8 percent, permitting a 93 percent slot payout.

State taxes on casinos in Pennsylvania are 34 percent, Delaware 42 percent, West Virginia 54 percent and Maryland the highest in the U.S. at 67 percent. While a slot parlor with a hot dog stand is less expensive to run than a casino, Maryland's over the top state tax rates will limit the number of returning players at Maryland locations.

It's a shame that our law makers are not familiar with the concept of competition.

Finally, I question how it came to pass that slot players are selected to bear the responsibility for the failure of the horse racing industry. Only an entertaining, fully profitable casino will offer any long term hope of competing with Internet entertainment in all its forms.

An Eldersburg slot player

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