Casino panel to urge table game tax cut

DOVER — A committee created to analyze the state of Delaware’s casino industry is poised to recommend lawmakers slash the table game tax rate in half, among other changes.

The Video Lottery Advisory Council on Tuesday agreed to support the same recommendations it has issued the past three years but in a different order.

The committee’s top priority is lowering the table game tax rate from 29.4 percent to 15 percent and eliminating the annual $3 million fee. The current tax rate is the highest in the country, according to the VLAC.

The state began offering table games like roulette, craps and blackjack in 2010, but the costs make it “unprofitable,” the VLAC said in prior recommendations.

Changing the overall tax structure, the top ask in prior years, has been moved down the list of proposals.

“We’d still like to get it, but realistically it has a less of a chance than table games,” Dover Downs Hotel & Casino President and CEO Ed Sutor said Wednesday.

Lowering the table game rate would help “maintain jobs,” he said.

Mr. Sutor previously said Dover Downs has never turned a profit off table games, but he has defended it as a necessary offering.

“Why do we keep it? We want to be a full-fledged casino,” he said at a September 2016 VLAC meeting. “If we took it out we’d be a slot bar, something we had been for years and we despised.”

Other recommendations include shifting more of the costs of slot machines to the state and adding credits for capital development and marketing.

Legislation to provide relief to the casino went nowhere in 2015 and 2016, with lawmakers loath to reduce revenue to the state in tough budget years.
However, gaming executives have said there is an imminent need for change due to increased competition from other states.

“In 2016, Dover Downs generated $77 million for the state and the horsemen, while the company carried more than $180 million in expenses and was left with less than one half of 1 percent profit margin,” Dover Downs President and CEO Denis McGlynn said in January.

Dover Downs, the only one of the state’s three casinos that is public, is set to release its third quarter earnings next week.

Mr. Sutor said he believes the administration of Gov. John Carney is relatively sympathetic towards the casinos.

Gov. Carney’s office did not respond to a request for comment.

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