Report: “No meaningful impact” on land-based sector from Indiana igaming regulation
IGC-commissioned report suggests Hoosier State is “well positioned” to make a successful igaming launch
A prospective launch of igaming in Indiana would not harm the state’s local brick-and mortar gambling operators, according to a new Indiana Gaming Commission-sponsored study into the sector.
The study, carried out by Spectrum Gaming Group, included a market and policy analysis which suggests the state could generate as much as $2bn in revenue after three years of legalization.
One area which would be of particular benefit without detraction to the state would be live-dealer gaming, something which the report calls for.
“The addition of igaming without live-dealer gaming has no meaningful impact on direct casino employment – but it would create additional jobs in igaming operations,” Spectrum explained in the analysis.
“It is when operators launch live-dealer gaming as part of their igaming scheme that states realize meaningful employment impacts, typically through a third-party provider.”
The analysis continues: “Based on results in other states, live-dealer igaming in Indiana could create many hundreds of jobs through the employment of dealers in purpose-built studios for this segment of igaming.
“The significant economic impacts of live-dealer gaming can be realized if the studios are situated in the host state, as is required in four of the five current live-dealer igaming states,” it adds.
In respect of employee growth, Spectrum researchers contacted the two biggest live-dealer operators, Evolution and Playtech, for estimates on how many employees they would respectively recruit if igaming got the go ahead in the Hoosier State.
In its estimate, Evolution suggested that as many as 800 new roles might be created by the firm in Indiana, with rival supplier Playtech suggesting they would look to employ 100 new staff in the state during its first year of operation.
From a policy perspective, the study looked at three potential licensing models for igaming: open (licensing for all), closed (limited to local casino operators) and hybrid (some exclusivity, but third-party licensing available through skins).
In addition to looking at policy, the Spectrum report applied three different taxation rates – 20%, 30% and 45% – with taxation levied on operator gross gambling revenue (GGR).
At its highest level of 45% of GGR, the projected tax receipts of the state could, according to the study, be as high as $943m.
Presently, land-based operators with slots can be taxed at rates of between 5% and 25% based on their earnings, which profits from blackjack, poker, and roulette taxed at between 15% and 50%.
As justification for its support of igaming growth and the proposed taxation levels used, the Spectrum study cited the scaled down nature of igaming in comparison to its land-based counterpart, requiring “few direct employees” and little capital investment in buildings.
“With a mature casino industry and digital sports betting in place, Indiana is well positioned to integrate igaming with its existing responsible gaming measures, although additional funding should be dedicated to treatment services,” the study concluded.