Florida Horse Racing Market to Receive Tax Cut on Slot Machine Earnings

The Florida racing industry receive a boost after the House of Representatives passed a legislation on April 19th, 2010 that will scale down revenue taxes on slot machines at the Gulfstream Park and Calder Race Course and could eventually allow slot machines at the Tampa Bay Downs and Hialeah Park.

The tax break for "racinos" is part of the gambling compact between the Seminole tribe. The compact will allow the tribe the right to exclusively offer blackjack at five of their casinos. The Senate passed the compact on April 15th, 2010 before it was approved by the House by a 79-39 vote on April 19th.

Gov. Charlie Crist said that he would approve the bill, which is expected to produce $1.3 billion dollars for Florida in its first five years. During the discussions in the legislature on Monday, representatives that are in favor of the gaming compact pointed out the additional benefits of the additional revenue for the state.

They also cited the creation of new employment opportunities in the state. Under the proposed gaming compact, the state tax on earnings from Class III slot machines at Calder, Gulfstream and other pari-mutuel establishments in South Florida would drop from fifty percent to thirty-five percent.

Hialeah could add slot machines as long as it offers twenty days of live racing-at least half of which must be Thoroughbred racing. Tracks could also open their poker rooms twenty-four hours a day rather than the current twelve hours.

Overnight purses can also go up to $25,000 dollars per day at Calder this summer because of the tax relief and by as much as $40,000 dollars per day next winter at Gulfstream Park. Gulfstream President Ken Dunn said that from the racing side, it will give them a significant amount of money for the purses.

He said that the contract they have with the horsemen calls for them to receive fifty percent of any of the reduction that they get, so it will increase the percentage of slot machine earnings that the horsemen receive. He added that it is a large amount of money and can help them as they go forward into the next year.

Other parts of the gaming compact include permitting the Florida Thoroughbred Owners and Breeders Association to host a non-profit Thoroughbred meet, bigger betting limits at card rooms and the chance of permitting pari-mutuel operations, including bingo-style machines and Instant Racing, outside of South Florida.

The gaming compact is expected to go into effect on July 1st, 2010.

Author: Theo Evans
Wednesday, 11 August 2010