Casino news from http://www.nj.com/
In a fiscal year when important programs are being dealt devastating blows by the state and taxes are constantly on the rise, one group is feeling no pain -- in fact, the proverbial wounds inflicted by the McGreevey administration are beginning to heal. As of July 1, the collective taxes paid by Atlantic City casinos were reduced by $30 million and related industry tax changes will bring their overall savings to $43 million.
In 2003, then-Gov. James E. McGreevey lost the battle to increase the taxes on casinos from 8 percent to 10 percent. Instead, he lowered the tax to 7.5 percent but instituted a 4.25 percent tax on freebies given by hotels to their best customers. That tax, however, was agreed to only with the provision that it would be eliminated "within a few years." Apparently "a few years" have come and gone and the freebie tax will be phased out over the next two years to live on only as a bad memory to casino management. The income tax is also set to expire. Last, a portion of the money collected for the casino revenue fund, whose proceeds go to the disabled and the elderly, will now be redirected into economic development projects, including new hotels and casinos.
New Jersey residents might remember that the casino management predicted "disastrous re sults" when taxes were increased. Interestingly, instead of watching the boardwalk go from light to dark, the glitz and glitter have only grown brighter. Not only have a new hotel and many additions or renovations appeared on the boardwalk in that period but, last year, for the first time in history, the casinos collectively surpassed $5 billion in revenue. It looks as though the tax did not affect their good fortunes.
Besides, New Jersey has already been especially kind to the gaming industry this year. While bars and restaurants mourned the loss of a smoking section, casinos were exempted from the ban. This despite the fact that the smoking ban rationale -- smoking is harmful to workers and nonsmokers in the vi cinity -- still applies to casinos.
It is high time that Atlantic City be taken out of the bubble that clearly separates it from the rest of New Jersey. State Sen. Shirley Turner, D-Mercer, and Assemblyman Reed Gusciora, D-Mercer, are attempting to do just that. They call for maintaining the 2003 taxes, increasing the casino revenue tax to the originally proposed 10 percent and preventing the fees from the casino revenue fund from going into economic development projects. These commendable efforts, although initially well received, now face resistance caused by the re cent budget-crisis government shutdown.
The government shutdown should not be a factor in legislators' minds, seeing as it affected everyone across the board and the $5 billion in profits could offset the loss of a few days. What should factor in is the $4 billion deficit in the state budget or the massive cuts to important programs. During these hard times, every dollar counts and the casinos have plenty of dollars to give.
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