Hawaii and Utah have long been the pariahs of the gambling industry. They have not been seduced by lottery nor racetrack, casino nor gambling hall. This may soon change as a new piece of legislation, House Bill 1815, is trying to make its way through the legislature.
Sponsored by Rep. John Mizuno, the bill attempts to establish a sports betting industry on the island state. However, the bill seems to raise more questions than it answers. For one, a proposed 55% tax rate is already a little too onerous, and it leaves some ambiguity as to who would be footing the bill.
Section 15 of the bill argues that the tax would apply to the winnings paid out to any person by the sports wagering provider, but this does not clarify who ends up with the tax burden. This is the only reference to specific taxation the 20-page bill makes.
The 55% is most likely inserted into the language of the bill not so much to wink at future gambling operators, but rather to sweeten the pill for politicians who may be opposed to the idea of passing gambling laws in the state in the first place. Given Hawaii’s historic lethargy on the matter, Mizuno seems to be clever about the way he wants to push the bill.
Hawaiians Already Gamble, Bill States
While not all legislators may be happy with the idea of a legalized sports gambling industry, they need to at least agree on what provable facts are. For one, the bill talks about the tens of thousands of Hawaiians who already participate in online gambling activities, joining “illegal sports gambling on unregulated internet 7BALL websites.”
According to Mizuno, tens of millions of dollars in revenue is being generated from online gambling but the state takes no cut because the activities happen underground. Mizuno’s bill calls for a responsible, secure, and legal system for monitoring and conducting online gambling that would benefit consumers and the state in equal measure.
The bill also states that a new agency will be created allowing online sports wagering to be conducted and monitored. The “corporation,” as the bill refers to it, will be part of the Department of Business, Economic Development, and Tourism. The draft also goes on to talk about who may qualify for providing gambling products. Any supplier or operator would need to be well-versed in US gambling laws, it states, winking at mainland firms.
