Michigan Moves Closer to legalizing Sports Betting

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Michigan Moves Closer to legalizing Sports Betting

Michigan looks set to join the growing band of states that have legalized sports betting after local politicians passed a bill to allow the practice within its jurisdiction.

The proposal requires final approval from Governor Gretchen Whitmer, but that appears to be a mere formality after she confirmed she was ready to rubber-stamp the bill.

States like New Jersey, Pennsylvania and Nevada have already legalized sports betting and are reaping the rewards from the taxes generated by the industry.

Light at the end of the tunnel for Michigan

It has taken a little while to come to fruition, but Michigan is finally on track to join the growing sports betting party in the United States.

Local politician, Brandt Iden, has been the driving force behind the proposal which has gradually been amended to get to this point.

The bill will allow three casinos and state tribal gaming venues to apply for a sports betting license at a cost of $100,000.

There will also be an annual renewal fee of $50,000, while all sports betting revenues will be subjected to a tax of 8.4 percent.

The move will allow Michigan to fall in line with other states in providing players with a fully licensed and regulated sports betting sector.

The bill states that internet gaming providers would be required to provide “adequate gaming participant verification measures, including mechanisms to detect and prevent the unauthorized use of internet wagering accounts and to detect and prevent fraud, money laundering and collusion”.

This would give bettors in Michigan confidence that the sites they use to place their sports bets would be trustworthy.

In addition to boosting consumer confidence, Iden says the new legislation will provide valuable tax revenues for the state.

He is eyeing two big basketball events next spring – The Big Ten Tournament and March Madness – as the starting point for sports betting in Michigan.

“They are a huge revenue opportunity for us,” he said. “People are going to go down (to Indiana) and place their bets – I want to be able to take that money here in Michigan as well.

“Operators have been getting ready for this. We’ve been having these conversations over the past four years and I really think that these operators are going to be up and ready to go.”

Finance expert backs the bill

The decision by the Supreme Court to lift the ban on sports betting opened the door for states to cash in through taxation.

While other states have dragged their heels, the likes of New Jersey have highlighted the benefits of allowing sports betting sites to operate within its boundaries.

The Garden State has generated around $40 million in tax since legalizing sports betting and the average monthly figure is rising as revenues skyrocket.

New Jersey uses the extra income to support a variety of social programs and this a similar model to the one that will be adopted by Michigan.

The state plans to send the majority of sports betting taxes to the School Aid Fund which funds K-12 schools in the area.

Other initiatives include compensating local firefighters who have contracted cancer due to exposure to chemicals and smoke.

Alex Calderone, a financial analyst and the managing director of the Calderone Advisory Group, believes the legalization of sports betting in Michigan is good news for the state.

“The only party that’s really going to be hurt by the legislation of sports gambling are the folks who are undertaking these operations illegally in the black market,” he said.

“I really do think it’s a win-win scenario for everyone involved.”