As several states in the US get started in the sports betting industry, it seems Puerto Rico wants in on the action. Governor Ricardo Rosselló has introduced a measure that would allow wagering on sporting events, as well as online video games. Estimates show that Puerto Rico could benefit handsomely from the gambling expansion.
Generating much-needed funds
According to the governor, expanded gambling in Puerto Rico could generate as much $3bn (€2.6bn) a year. Two studies show just how the region could reap the benefits from the new gaming options.
Research by the Spectrum Gaming Group revealed that iGaming could generate as much as $44m (€39.1m) to $66m (€58.7m) for Puerto Rico on an annual basis. The Innovation Group conducted another independent study, estimating that as much as $68m (€60.5m) in revenues would be generated by 2022.
As with other areas, officials tend to worry about how land-based casinos will be affected by an expansion. Both studies revealed that the introduction of the new segment would not create cannibalization regarding the casinos of Puerto Rico, as the new industry would involve a different demographic.
Governor Ricardo Rosselló said: “This industry has the potential to convert Puerto Rico into a jurisdiction in the vanguard of allowing the establishment of this new model, which will have a positive effect on our economy.
We have worked on aggressive legislation that aspires at being able to market the island at the international and national levels as an attractive destination for the millions of people who bet on sports events.”
Representative Nestor Alonso Vega, of the majority New Progressive Party, was responsible for authoring the legislation. The bill would legalize wagering on sports events and online video games as well as authorize online fantasy sports. Vega sees the e-sports segment as one that is growing, but not adequately regulated.
The measure would generate revenues for the Treasury, coming from licensing and taxes on both plays and prizes. The Treasury will set a 6% tax rate on wagers placed in person, and a rate of 11% on online wagers.
A new Gambling Commission would be created to regulate the new industry. The commission would have seven members from the public and private sectors. These individuals would be in charge of regulating sports betting, electronic games, equestrian sports and other areas. The Financial Intuitions Commissioners’ Office would be in charge of overseeing the new industry.
Revenues generated from the new industry would be distributed in several ways. Retirement of pensioners and youth sports programs will be covered, along with services to fight gambling addiction. Money will be provided to outfit police with better equipment and to promote educational initiatives. Funds will also be set aside for the new commission to cover administrative costs and implementation needs.