A new legislation will seek to establish a regulatory framework for skill video games in Pennsylvania and create a taxing structure that could generate an estimated $300 million in tax revenue annually.

The new initiative comes from Sen. Gene Yaw who circulated a memo to Senate members telling them about his plans to introduce regulation and taxation on skill video games in the Commonwealth and asking other Senators to join him and co-sponsor the upcoming bill.

Pennsylvania’s skill game terminals are manufactured right here in Lycoming County and the finished products exist in fraternal clubs, veterans’ organizations and taverns, as well as other local businesses throughout the Commonwealth.

Sen. Yaw statement

Due to their element of “skill,” skill video games remain outside of the scope of the Pennsylvania Gaming Act which regulates legal gaming machines. The machines also remain untaxed while their number across small businesses such as bars, restaurants, convenience stores, clubs, and others in the state continues to grow.

In the memo, Sen. Yaw told his colleagues that skill video games have the potential to create significant benefits to the state such as additional tax revenue and new jobs if subjected to operating in a regulated environment.

Tackle Illegal Gambling, Support Small Businesses

Moreover, the new bill will serve multiple purposes as it will not only generate extra funds for the state but will help authorities get rid of illegal gambling and provide support to small businesses by giving them access to an additional revenue stream.

“Skill games are a piece of the small business economy in our state, and it’s time we recognize the benefits of this emerging industry and offer regulatory support so that we can ensure it flourishes – safely and responsibly,” Sen. Yaw added.

He added that an industry such as video game manufacturing that has created hundreds of manufacturing jobs in and around the district he represents. Yaw added that one of the largest skill game manufacturers is located there, has been sourcing nearly all of the components in the US, and is currently redirecting new projects from China to Williamsport.

Under his proposal, all skill video games in Pennsylvania will be connected to a terminal collection and control system monitored by the Commonwealth so that every transaction is registered and due taxes are accrued and timely paid.

According to experts, if passed the proposal is expected to generate approximately $300 million in annual tax revenue for the state. Sen. Yaw additionally believes that it will also result in creating new family-sustaining jobs.

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