Moody’s Approves of Online Gambling
Moody’s Investors Service has said that it approves of New Jersey’s decision to allow internet gambling.
The credit rating agency said that it provides “a credit positive addition to state tax revenue.”
The state is predicting that online gambling could add as much as $180 million to casino revenues over the next fiscal year. In its weekly Credit Outlook Moody’s said that the amount “which may be optimistic, would reduce a key area of state budget risk.”
It said that “In fiscal 2013 year-to date, poor revenue performance has opened a $350 million budget gap for the state, of which underperforming casino revenues make up 12%.”
The new laws include a 15% tax on online gambling revenues which will allow the state to make back some of the casino revenue which it has lost to competing states such as New York, Connecticut and Pennsylvania.
However, Moody’s did have a word of caution, “given the lack of historical data available for estimating online gaming revenues, the budget will remain vulnerable to potential over-projection of this new resource.”