Lesniak reintroduces New Jersey I-Gambling Bill

Under the new bill, the New Jersey Division of Gaming Enforcement will be authorized to issue foreign Internet wagering permits to allow for the offering of internet gaming to other US states and foreign jurisdictions. Such activity will only be allowed by New Jersey casinos and their affiliated internet gaming partners.

In addition, interstate and foreign igaming will require “an interstate or foreign compact or agreement with an interstate or foreign jurisdiction in which Internet wagering on authorized games is lawful and regulated.”

The bill requires licensees to maintain their servers and also keep all records in within Atlantic City where they can be inspected by regulators.
Gaming revenues from foreign markets will be subject to the 15% tax and 2.5% contribution to the Casino Reinvestment Development Authority mirroring the taxes paid on New Jersey online gaming revenue. Operators will be able to claim a tax credit in New Jersey for tax required to be paid in the foreign jurisdictions.

The amended bill allows for casino games and poker, but not for sports betting which may contravene US law.

Players’ accounts will need to show the total amount won or lost since the account was established, and give a “detailed accounting of all other Internet gaming sessions, when a session begins at log on and ends at log off, including time and date of log on and log off and the amount of money won or lost on gaming and the amount of money spent from the account on merchandise or services.

Lesniak’s intent is to create an environment which will carve out a niche for the Garden State as an international regulatory hub, creating tax revenues and jobs in the process.

Lesniak’s bill has undergone some changes since it was first published last year. It still insists that licensees have servers in the state of New Jersey and keep all records of their business present and open to the state’s regulators.

Lesniak has proposed a taxation regime of 15 percent on foreign gaming revenues, along with a 2.5 percent contribution from licensees to the Casino Reinvestment Development Authority. He has also proposed a tax credit scheme in relation to the operators’ foreign tax obligations, enabling them to offset some of these against New Jersey tax levies.

In the past Lesniak has argued that, provided the licensees restrict their operations to players outside the United States and segregate them from US player pools, there is no barrier to them being licensed by, and operating from, New Jersey.

However, that doesn’t mean New Jersey-based firms (in other words, have their servers there, for example) couldn’t make money off of players elsewhere.
In order to do so, Lesniak’s bill would require some sort of deal between New Jersey and the other jurisdiction with the players. The taxes would need to be sorted out. Obviously the Garden State’s partner in all of this would need to have legal online gambling as well. Lesniak said that he wants New Jersey to be the “mecca of Internet gaming.”

The bill apparently paves the way for a deal between Nevada and New Jersey, but it’s unclear if that means the player pools in that situation would be mixed.
More details on the proposal should come in the following weeks and months, as it will surely get amended amid discussions by lawmakers. One thing is for sure, New Jersey is bolstering online gambling. Its first games began in late November.