Bill filed to tax, regulate sweepstakes

Posted April 3, 2013

— Reps. Michael Wray, D-Northampton, and Jeff Collins, R-Nash, have filed a bill that would legalize, tax and regulate video sweepstakes.

House Bill 547 would reverse course on the state's current policy.

Lawmakers have been trying to stamp out sweepstakes, which came into the state after stand-alone video poker machines were outlawed in 2006. After several legal setbacks, the state Supreme Court in December upheld a state law banning the games.

Sheriffs and district attorneys across the state, including in Wake and Cumberland counties, have stepped up enforcement against the games over the past month. However, enforcement is still spotty. 

Under the Wray-Collins bill, sweepstakes would be regulated by the state Department of Commerce.

Sweepstakes parlors would pay an annual excise tax of $2,000 per establishment and $1,000 per machine. In addition, the bill would crate a 4 percent gross receipts tax.

The bill would also allow local governments to impose limited excise taxes on the machines but would prohibit cities from outlawing the machines.

Wray represents the area that includes the Royal Palace Theater in Roanoke Rapids, a building owned by the city that makes extensive use of sweepstakes machines to lure customers.

Sweepstakes cafe Lawmaker: No sweepstakes costs NC money, jobs

The state is missing out on a lot of revenue from sweepstakes games, he said, estimating that his proposal would raise $300 million to $400 million annually.

"This is America. This is North Carolina. People should have the freedom to do what they want," he said.

People have the option to play the state lottery or go to the movies, Wray said, and sweepstakes games are just another form of entertainment.

"At the same time, the companies need to do what they should," he said.

Legalizing and taxing the games would make sure all the games were "on the up and up" and obeying state rules, he said. Right now, there are different rules for the games in different cities, and law enforcement agencies are confiscating machines in still others.

"This is about jobs," he said, noting that sweepstakes parlors employ people directly and fill retail spaces that would otherwise be vacant.

The sweepstakes industry welcomed the proposal, saying it would end the "legal uncertainty" over the games and restore lost jobs.

Still, the bill will almost certainly face opposition – if it's heard at all.

Asked if thought the House would take up the sweepstakes bill, House Speaker Pro Tem Paul "Skip" Stam said, "I don't think so."


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  • dumbhick Apr 5, 2013

    Christian Republican lawmakers vote to legalize & tax gambling.

  • charliewestnutt Apr 4, 2013

    DITCH In answering your question in your post Mr Wray voted for gay marriage imagine that!

  • Cock a doodle doo Apr 4, 2013

    Won't this be in conflict with our new state religion?

  • tayled Apr 4, 2013

    Here goes wishy washy NC again. first, we renege on the contract for the Dix property. Then, we make these sweepstakes games illegal and confiscate the games,...but wait, now we make them legal again so we can tax them.

    We must be a laughingstock in this country!

  • matthewwright378 Apr 4, 2013

    faycop, you don't have any idea what you are talking about. These are just small business owners that are residents of North Carolina. NOTHING shady about it.

  • MonkeyFace Apr 4, 2013

    Wow,now that the legislature is proposing a state religion, I wonder if gambling ("Bill filed to tax, regulate sweepstakes") might be considered immoral, sinful and in violation of the state mandated religion??? Oh no, that can't be possible because the "sin tax" )on gambling will give the politicians more revenue to waste on frivolous endeavors.
    jaydosse--------------seeing how the lottery can be seen a gambling as well, I highly doubt it.

  • faycop4ncstate Apr 4, 2013

    If the state wants to allow gambling, we don't need sweepstakes. These places are owned by shady characters that often have questionable backgrounds. If you want revenue from gambling, open it up to corporations and big casinos. You want to talk about money and jobs, bring the MGM Grand.

  • matthewwright378 Apr 3, 2013

    Rebelyell...the bill requires the servers to be located inside the specific store. You may want to try and read the legislation first.

  • matthewwright378 Apr 3, 2013

    Catawba County Judge found a defendant "not guilty" today because the results of the sweepstakes were displayed prior to the entertaining display. That is why this bill is needed. Because people are following the law and still be wrongly charged. Time for the State to regulate.

  • fauxpaws2000 Apr 3, 2013

    No, don't think so...

    Asking the poor to lock their own shackles is morally abhorrent.

    What sort of elected w***e consigns his constituents to continued poverty?

    Would that elected official play a game where he gives a dollar and gets back ninety-eight cents back every time he plays?

    Do something positive with your elected position and improve the lives of your constituents instead of serving your masters.