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Casino Revenue Tax

Casino Revenue Tax

Ohio has four casinos located in the cities of Cleveland, Columbus, Cincinnati and Toledo.

A tax has been levied on the gross casino revenue received by a casino operator of a casino facility.

This tax is in addition to any other taxes or fees imposed under the Revised Code or other law and for which the casino operator is liable under Section 6(C)(2) of Article XV, Ohio Constitution.

 

The gross casino revenue tax is a daily tax imposed on casino operators of casino facilities at the rate of 33% of the gross casino revenue at the casino facility.

An operator’s gross casino revenue includes the total amount of money exchanged for the purchase of chips, tokens, tickets, electronic cards, or similar objects by casino patrons, less winnings paid to wagers.

Casino operators are required to file and remit taxes due no later than noon each day banks are open for business.

Collected revenues accumulate in the Ohio Casino Tax Revenue Fund. By the 15th day following the end of a calendar quarter, money is transferred from the Ohio Casino Tax Revenue Fund into the funds listed below:

  • Fifty-one percent (51%) into the Gross Casino Revenue County Fund
  • Thirty-four percent (34%) into the Gross Casino Revenue County Student Fund
  • Five-percent (5%) into the Gross Casino Revenue Host City Fund
  • Three-percent (3%) into the Casino Control Commission Fund
  • Three-percent (3%) into the Ohio State Racing Commission Fund
  • Two-percent (2%) into the Law Enforcement Training Fund
  • Two-percent (2%) into the Problem Casino Gambling and Addictions Fund

Please click Here to see the Distributions to date.

 

 

The Ohio Lottery Commission is responsible for the administration and enforcement of Ohio’s VLTs. Please click here for a link to the Lottery Commission.

Pursuant to R.C. 5747.063, if a person’s winnings at a casino facility are such that the IRS requires reporting on form W-2G or 1042-S ($1,200 or more not reduced by the wager for slot winnings; more than $5,000 reduced by the wager or buy-in for table win; or $600 or more if the winnings are more than 300 times the amount wagered or are subject to federal income tax withholding), the casino operator shall deduct and withhold Ohio income tax from the person’s winnings at a rate of four percent (4%) of the amount won. (Please note that, prior to June 12, 2012, each casino operator was required to withhold Ohio income tax at a rate of six percent (6%) for those people meeting the thresholds mentioned above.)

The casino operator shall issue a form W-2G (or form 1042-S for a foreign individual) reflecting the amount deducted and withheld, and also shall obtain any additional information deemed necessary. Please click here for a link to the statutory language relating to casino withholding.

Casinos are not required to withhold school district income tax from prize winnings.  Nonetheless, a taxpayer remains liable for the taxes imposed by section 5747.02 or Chapter 5748. of the Revised Code.  An individual residing in a school district with a traditional income tax base who incurred prize winnings may need to make estimated tax payments as required by section 5747.09 of the Revised Code using form SD-100ES.

Please click here for more information regarding school district income tax.

The Ohio Casino Control Commission is responsible for licensing and regulating casino operators, their employees, and gaming-related vendors. To learn more about the Commission’s responsibilities, please click here.

The casino figures reported by the Ohio Casino Control Commission reflect gaming activity occurring during the indicated month. If one sums the gaming activity for the months that comprise a calendar quarter and multiplies that amount by 33% to derive a hypothetical gross casino revenue tax collection estimate, it will not match the actual amount of gross casino revenue tax collected during that quarterly period. The main reason for the difference between that tax estimate and the actual taxes collected is due to timing.

The tax collections allocated to each of the seven funds for a given quarter are based on taxes paid into the state accounting system during the prescribed quarterly period.  For example, the amounts allocated into the seven funds in October 2012 are based on July-September 2012 tax collections. There exists a time lag between when casino gaming activity occurs and when the tax on such activity is deposited into the state’s revenue accounting system. Therefore, the tax on the last few days’ worth of gaming activity for a particular quarterly period will appear as tax revenue during the next quarterly period.  No gaming activity period will go untaxed. There is merely a timing difference between the Ohio Casino Control Commission gaming activity figures and when the tax on that gaming activity is actually received by the state. 

The only published estimates by the Department of Taxation are those released in October 2009 for the casino ballot issue. Those estimates were released in compliance with a statutory requirement that the Department of Taxation produce an estimate for any new tax proposed by an initiated state ballot issue. The estimates were based on a set of assumptions indicated in the document (http://www.tax.ohio.gov/research/2009_Issue_3). The 2009 estimates were intended to reflect the first full year in which four casinos were in operation, with no indication as to when that may occur. In contrast, the July 2012 fund deposits reflect taxes paid by two casinos that were operating for only a portion of the second quarter of 2012. Fund deposits for future quarters will be larger than the July 2012 deposits, because those upcoming quarters will reflect three full months of activity at the Cleveland and Toledo casinos. Eventually, the deposits will also reflect activity occurring at the Columbus and Cincinnati casinos once those facilities commence operations.    

Additional Resources

Additional Resources