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Michigan Launches New Online Gambling Bill

- April 18, 2016 By Oliver Young -

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The bill proposes eight online gambling licenses worth $5 million each

Michigan has recently launched an online gambling bill which proposes new ways of legalizing and regulating this industry. The US state currently has a limited form of online lottery gaming, but the online gambling activities might be expanded with the introduction of this recent bill to the state Senate.

Senate Bill 889, also referred to as the Lawful Internet Gaming Act, was launched by state Senator Mike Kowall and four other members of the Senate and its objective is to legalize online gambling in Michigan.

The bill, however, leaves open the certain types of online gambling that will be allowed, supposedly to avoid conflict on the issue related to sports betting with the federal Professional and Amateur Sports Protection Act which resulted in legal problems in New Jersey.

Details on the Proposed Bill

The Lawful Internet Gaming Act proposes the issuing of 8 five-year online gambling licenses worth $5 million each. They will be issued to already licensed operators in the state or tribal groups. The bill also creates space for Michigan to negotiate with other US states and even with international operators but only if it’s all consistent with the laws in the state. The $5 million payment also serves as an advance payment on gaming taxes in the future. In addition, all applicants must deposit a non-refundable amount of $100,000.

Furthermore, the state will collect a 10% tax rate on gross gaming revenue from operators every month and after the first five years they will have the chance to renew the deal for another five years. There are also some details about consumer protection. In particular, only people aged 21 and above can take part in gambling. Other info includes precaution measures against problem gambling and deals for the licensing of support parties which will also last for five years.

The state’s gambling commission is going to be responsible for all online gambling activities proposed by the bill and it will deal with subjects related to fraud prevention, protection from problem gambling, fair gaming and money-laundering precautions.

Online Gambling Should Be Properly Regulated, Says Sen. Kowall

The Senate Committee on Regulatory Reform currently has the bill and it’s their responsibility whether it will move forward or not. Even though it’s early days yet, it will be interesting to see the opinions of the opposition and their reactions.

When the bill was introduced, State Senator Kowall said that the Internet is now part of our everyday lives and online forms of entertainment such as playing casino games are widely accepted by people. Therefore, it would be best to properly license and regulate this industry in order for Michigan to benefit from the tax revenues.

Kowall is a member of the Committee on Regulatory Reform as well as a vice chairman of the Senate Oversight and Commerce Committee, Government Operations Committee and the Joint Committee on Administrative Rules.

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