A Place To Put the Sin Taxes

Birds do it, bees do it, even educated fleas do it,” wrote Cole Porter in his famous song in 1928. Of course, he was talking about falling in love (I wonder how the lyrics would have been written in a rap song today), but it made me think about gambling, and marijuana. That is, a blueprint for when marijuana is legalized.

Let’s face it. The cat’s out of the bag and any state’s efforts to really regulate or control gambling is, well, like trying to herd cats. That’s why Florida’s always-ongoing negotiations with Indian tribes about what they can do and can’t do, or whether new casinos can open up seems phony. That’s why the effort to stop a Panhandle tribe, the Poarch Band of Creek Indians, isn’t going to work. Florida argues that the tribe isn’t recognized by the US (I don’t have a clue why). So, the Indians say, they’re going to grow marijuana. The Indians are going to get the last word. Count on it.

Casinos and other separate nation permissions that old treaties gave them are the Indians’ much-deserved revenge. All those broken treaties, moving to reservations, uprooting them from their lands, deserve some reward. Winning in spades, of course, are those tribes who were moved to worthless land that later turned out to have precious minerals. But, again I digress.

The subject is gambling, which, even excluding the seven state Indian casinos, is everywhere. First, the state’s in it big time with the state lottery. So is almost every state. Then thereare a smattering of non-casino slots, horse racing, dog racing, resort gambling and jai alai. All nice sources of revenue for the state and the operators, not your average citizen or bar owner who might want to run their own little side show. There’s a lot of side betting, too. Private poker games ($10 limit on the pot by Florida law), sports betting pools, off-shore boat casinos, church bingo, and a hundred other “I’ll bet you’s.”

After all, as I noted, everyone’s doing it. One survey claims that 86 percent have gambled at least once in their lives and 46 percent gamble regularly, although 33 percent don’t at all. The latter probably doesn’t count private gambling. Seventeen percent gamble once or twice a week (doesn’t count the lottery). And, by the way, about six percent have problems with it. Yes, we’re committed to gambling. People want to do it and, most importantly, the state wants the revenue.

And, that’s the rub. Nearly all the states have some form of gambling and some that don’t are considering it. That means competition, and competition means that not every unit survives. Think Atlantic City. Gambling was the savior of this once very nice, but fading seaside resort. It’s a double loser now. Gamblers don’t come and the waterside resort factor is no longer. Las Vegas is next. Once a mecca for gamblers, particularly after Cuba shut down in 1959, it is now losing ground to every other state. Gambling is a trillion-dollar industry and won’t fade in itself, but the competition is going to be fierce and promises all sorts of dilemmas.

One instance is the state of Pennsylvania (my home state), which gradually expanded gambling and quickly reaped the tax dividends that go to both the local communities and the state. The promised major reduction in property taxes never occurred. However, there’s trouble in paradise. Because of competition in other states and within the states, casino revenues are beginning to drop. That has led the industry to pressure the legislature (amply supplied with political funding) to consider protecting the industry.

Here are a few of the proposals: work with the gaming industry to prevent online gambling; continue to allow smoking in the casinos; ban casinos at resorts; allow new games previously prohibited; provide tax credits for those who reinvest; permit 24-hour alcohol sales; permit complimentary drinks. They’ll get their way.

That might be the future for Florida, too, except that 200,000 people move in annually. That will stimulate marijuana use, too. (Should we legalize prostitution?) So, for now, we’re the big guys on the block in spite of competition from Georgia and Alabama. And that means money. All the citizens love it and don’t care about the source. It means not having to pay a local or state income tax. Same for acceptance of snowbirds who crowd the restaurants and roads.

Yet, we still have problems. That’s the high insurance rates for wind and flood coverage. These threaten property values and ultimately the tourist industry big time. My proposal is to earmark all new gambling taxes, and taxes from all future expanded state- approved so-called “sin” activities, to cover those big insurance premiums.

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Somethin’ on My Mind is an opinion column written by Bill Northrop. It does not necessarily reflect the opinions of Gabber publishers, staff or advertisers.

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