Ohio is pushing toward being the eighth state to legalize online casinos. Earlier this month, lawmakers introduced two bills that would bring iGaming to the state.

The first, Senate Bill 197, was introduced on May 13 and currently resides in the Senate Select Committee on Gaming.

The other legislation, House Bill 298, was introduced in that body on May 20 and was referred to the House Finance Committee.

The bills share some similarities, but there are also some key differences in the legislation that would add Ohio online casinos to the state's gambling menu.

Online casino licenses would cost $50M under both bills

With sports betting now available in 38 states, including in Ohio, lawmakers are looking for ways to gain additional tax revenue from gambling. Some are considering legalizing iGaming.

Online casinos are currently legal in seven states, with Nevada allowing only online poker.

Senate version of the Ohio online casino bill

As outlined by Legal Sports Report, SB 197, introduced by state Sen. Ethan Manning (R-District 13), would create 11 licenses for state casinos and racinos in Ohio. Each license would cost $50 million upfront and $5 million for renewal.

Revenues would be taxed at a rate of 36% for Ohio operators and 40% if operators contract with an external management company.

The bill would also legalize iLottery and pari-mutuel horse race betting, covering nearly all of the bases of online gambling.

The Senate Select Committee on Gaming recently conducted its second hearing on SB 197.

House version of the Ohio online casino bill

The bill introduced by Rep. Brian Stewart (R-District 12) and House Majority Floor Leader Marilyn John (R-District 76) would also charge operators $50 million for an iGaming license, though renewals would cost twice as much as the Senate bill, $10 million.

HB 298 would also allow licenses for 11 casinos and racinos, but the tax rate would be just 28%.

Additionally, the bill would ban:

• Bonuses
• Promotional credits
• Sweepstakes casinos
• Credit card deposits

During a committee hearing last week, John said adding online casinos would simply be a step up from sweepstakes casinos.

“It would expand a consumer base of players who prefer an online setting. We already have online gambling in other forms; this just takes it to the next level.”

Ohio casinos worried about cannibalization

John Pappas, a representative of geo-tracking company GeoComply, told lawmakers last week that a 25% tax rate would likely generate more than $500 million in annual tax revenue. He also suggested that a $50 million licensing fee would be too steep.

Several land-based Ohio casinos oppose the expansion of gambling. They are concerned they would experience a decline in revenue if iGaming was legalized.

Their argument is bolstered by Atlantic City. Retail casinos there reported a 5.1% year-over-year decline in revenue, while New Jersey online casinos enjoyed a 25.2% boost.

Looking for more online gambling tax revenue

Ohio’s potential foray into online casino gaming has been a long time coming. Lawmakers last year commissioned a study to examine the future of online gambling, with the findings suggesting that online casino expansion could be a sound course to follow.

Gov. Mike DeWine (R) has also been looking for ways to increase the state’s gaming tax fund. He doubled the Ohio sports betting tax rate from 10% to 20% in 2023. Earlier this year, the governor proposed another doubling to 40%, though state officials removed that from the state budget.

Also in consideration is a bill from Sen. Louis Blessing (R-District 8) that would implement a 2% handle tax on sportsbook companies.