Pennsylvania casinos ask court to force state to tax skill games found in stores equally to slots

The owners of twelve Pennsylvania casinos have asked the state's highest court to declare that a tax on slot machine revenue is unconstitutional because the state doesn't impose it broadly on cashpaying electronic game terminals known as skill games that can be found in many bars and stores.

- Marc Levy

The lawsuit, filed Monday, could endanger more than $1 billion in annual tax revenue that goes toward property tax rebates and economic development projects.

The state's collection of the roughly 54% tax on casinos' revenue from slot machines but not on revenue from skill game terminals violates constitutional guarantees designed to ensure that taxation is fair, the casino owners contend.

"There is no basis for requiring licensed entities to pay about half of their slot machine revenue to the Commonwealth while allowing unlicensed entities to pay no tax on such revenue," they argue in the lawsuit.

The lawsuit asks the court to force the state to apply the same tax rate to skill games or to bar it from collecting taxes on slot machines.