Pennsylvania Skill Game Proponent Says Proposed Tax Rate Only a Starting Point
Posted on: June 12, 2025, 08:23h.
Last updated on: June 12, 2025, 09:59h.
- Lawmakers in Pennsylvania continue to discuss skill games
- The controversial games provide small businesses with critical revenue, supporters say
- Casino and lottery reps say the slot-like games poach play from their enterprises
A lawmaker in Pennsylvania sponsoring legislation to legalize controversial slot-like skill games says the bill’s proposed 35% tax rate on gross revenue won by the machines is only a starting point.
Skill games task players with identifying winning paylines. The element of skill can alter a player’s payout, which industry reps say declassifies the terminals as games of chance and makes them immune to Pennsylvania’s gaming laws.
Pennsylvania Skill is the leading skill game in the commonwealth. The unregulated games originate from Pace-O-Matic (POM), a Georgia-based company that developed the software behind the gray machines and assembles and distributes the cabinets through a partnership with Miele Manufacturing, a Pennsylvania firm specializing in amusement devices.
Pennsylvania Gov. Josh Shapiro (D) supports creating a regulatory framework for skill games in exchange for a large cut — 52%, or just 2% below the effective tax casino slots share with the state — of the games’ gross gaming revenue. Senate Bill 756 proposes a 35% skill game tax, while Senate Bill 626 suggests Harrisburg take just 16%.
Not the End Point
State Sen. Chris Gebhard (R-Lancaster) is one of the sponsors of SB756. After hearing opposition from POM and the many small businesses that house skill games regarding a 35% state cut, the small business owner who runs an insurance and risk management firm says the bill’s included tax rate is only a starting point.
Speaking with LebTown, a news outlet covering Lebanon County, Gebhard said the sponsors of the bill arrived at 35% not through some scientific calculation, but by simply meeting in the middle of the governor’s wishes and SB626. The senator added that there’s a long road ahead to determine the best tax for skill games.
We are in the first three innings of the game. We have a tremendously long way to go,” Gebhard said.
The casino industry in Pennsylvania is among the richest in the nation with gross gaming revenue reaching a record $6.13 billion last year, opposes skill games. Casino reps say skill games take business from their slot machines and brick-and-mortar properties, and as a result, have reduced the number of games on their floors in recent years.
Differing Opinions
The Pennsylvania Lottery also says skill games hurt its business model, as many skill games are located within authorized lottery retailers. The Pennsylvania Lottery, which primarily benefits older Pennsylvanians, says skill games have cost its operation an estimated $200 million over the past five years.
Every time somebody puts a buck into one of those unregulated machines, it undermines the lottery and the critical services it funds for our seniors like prescriptions and meals,” Shapiro declared during his February budget address. “Our seniors deserve better.”
Sen. Gene Yaw (R-Bradford), a sponsor of SB626, says Shapiro is missing the point.
What he [Shapiro] doesn’t understand is that skill games are very, very important to local taverns, special clubs, and most importantly, veterans organizations,” Yaw said. “He basically thumbed his nose at VFWs and American Legions.”
The Pennsylvania Supreme Court is expected to rule on whether skill games violate the PA Race Horse Development and Gaming Act, Pennsylvania’s governing gaming laws, in the coming months.
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