Pennsylvania Sen. Chris Gebhard introduced legislation last month that features regulation and tax framework surrounding skill games. Gebhard knows that Gov. Josh Shapiro and other lawmakers have been far apart on the tax percentage, which is why he chose 35%.
In Shapiro’s 2025 FY Budget address, he introduced a bill in April, is calling for a 16% tax.
A lot has to happen before skill games are regulated in Pennsylvania. The Pennsylvania Supreme Court is also expected to rule on the legality of the games at some point, too. However, there is no timetable on the ruling.
Gebhard’s tax rate is only a starting point
Skill games manufacturers, such as Pace-O-Matic (POM), have been seeking regulation for years in Pennsylvania. Despite an imminent ruling on the legality, it’s likely the machines remain legal.
While regulation and tax frameworks have been all over the place, Gebhard explained his rational to the Lebtown last week. He said that the 35% tax is just a starting point:
“I’ve thought for a long time that the sweet spot can certainly land somewhere between the mid- to upper 20s, maybe 30%.”
Gebhard came to 35% because it is between Yaw’s proposition at 16% and 54%, which is what casino slots are taxed. It is by no means an absolute figure, Gebhard continued:
“Really, we are basically in the first three innings of the game, and we have a tremendously long way to go before we get to wherever we’re going to settle. For people to turn the conversation as negatively as they have, I think, is doing nothing to help us achieve a positive outcome.”
POM is against Gebhard’s tax rate
Gebhard said to Lebtown that he s small businesses, and is looking for a fair tax rate for everyone. However, POM believes the rate is too high.
When Gebhard officially introduced legislation, Mike Barley, POM Chief of Public Affairs, told PlayPennsylvania in a statement last month:
“Senator Gebhard is not listening to business owners and fraternal groups suffering financially from an unstable economy and the skyrocketing cost of food and other goods.
“Local fire departments in the senator’s own district say skill game revenue is essential to their community protection efforts, and they can’t do enough fundraising to keep up with financial demands. They are grateful to have skill games to help with ever-increasing costs.”
POM is in favor of Yaw’s bill, which helps “small businesses and fraternal groups while making sure there is ability and funding for the state,” Barley continued to PlayPennsylvania.
All sides must come to an agreement before June 30 to start collecting tax revenue for the 2025/2026 fiscal year.
Small businesses speak out
A bunch of small businesses called out Gebhard’s bill in a t press release. Many of the companies said they would not be in business if the state adopts Gebhard’s plan. Here are some direct quotes from small business owners in the Keystone State:
“We are a small business, a private club that is a nonprofit. We give donations to local organizations in need. We use our skill game money for repairs on the building and food. If it wasn’t for skills money, we would not be in business anymore.” – Margot Chillas, Manager, Rainmakers Association Lodge (Lancaster)
“Skill games have had a large hand in helping us recover post-COVID, measures that were nearly a death blow to many neighborhood small businesses. Because of skill games, we were able to retain our employees and stay in business, continuing to serve our community, which we have been a part of since 1998. If ed, Senate Bill 756 would almost certainly cause us to shut down.” – Geeta Patel, Owner, Roxborough News Shop (Philadelphia)
“We are an American Legion, and we rely on the PA Skill games to help pay for general expenses and wages. The money that is raised from the PA Skill machine allows us to pay our employees a little more and to treat our to more benefits. If PA Skill were taken out of our establishment, the cost of our drinks/food would have to be increased. Higher prices, less customers. Huge Impact!” – Karen Bowers, Steward (Manager), New Holland American Legion (New Holland)
