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New Jersey Proposes Tax Relief for Atlantic City Casinos
- December 3, 2014 By Oliver Young -
Monday was a day of hope for the remaining 8 Atlantic City casinos after a tax relief proposal was made by Steve Sweeny, a State Senate President, and Senator James Whelan. According to the newly presented plan, Atlantic City casinos will get the chance to collectively pay $150 million in taxes for two years. Even though this amount may seem huge, it is much lower than the taxes that operators are paying now.
Both Sweeny and Whelan expressed their opinions about the proposal claiming it will only have positive effects. “This plan will help stop the bleeding,” was the Whelan’s statement, whereas Sweeny said: “My plan is designed to protect Atlantic City from bankruptcy and position the city for future economic growth.”
If this plan is accepted casinos will have to pay $150 million in the first two years. After that period the total payment amount will fall to $120 million if the annual casino revenues of Atlantic City remain between $2.2 billion and $2.6 billion. In the previous year the total Atlantic City’s casino profit was $2.86 billion. However, in the meantime four casinos were closed and the profits are expected to fall.
The Bill Is Good for both the City and the Casinos
It must be noted that the bill was not proposed to help only casinos, but also to help pay off the Atlantic City’s yearly debt of $25 million to $30 million. Sweeny believes that the current situation is very negative for Atlantic City and he said that the plan will prevent bankruptcy of the city. “With the multiple casino closings and competitive pressure in the gaming industry, Atlantic City is facing an unprecedented economic challenge,” Sweeny added.
Supporters of the plan are certain that it will help Atlantic City to efficiently plan its budget thanks to the predictable revenues. Additionally, fixed taxes will eliminate the tax appeals which made Atlantic City refund millions of dollars to some of its best casinos.
When it comes to casinos, Startribune reports that the bill will save Atlantic City casinos lots of money thanks to the decreased taxes. Furthermore, the plan includes a minimum health insurance and even retirement benefits to every casino worker; hence, everyone wins if the bill has the expected results.
It is Not Known Whether the Tax Relief Will Save Trump Taj Mahal
The Taj Mahal Resort Casino is one of the casinos who should be the happiest operator forthe proposal. The casino had several issues in the previous months; first it had problems with Donald Trump who wants his name taken off of it and then it had a labour dispute with its unionised employees. Furthermore, Trump Taj Mahal is struggling to stay alive.
After the plan was announced, Associated Press asked Trump Entertainment Resorts CEO Robert Griffin whether that is sufficient to resolve the dispute. All Griffin had to say was: “We will see.” Hence, it is not known if there is still hope for the resort or not.