A second bill submitted in the Ohio House of Representatives would legalize online casino gaming, barring sweepstakes-style games. This would be a significant change in the state's consideration of regulating digital games. House Bill 298 (HB 298), led by Rep. Brian Stewart, outlines a regulated iGaming model that benefits existing in-state gaming companies and limits market entry to new industry entrants.
Key Takeaways
- Ohio’s HB 298 would legalize iGaming, exclude sweepstakes casinos, and limit license access strictly
- Bill sets 28% tax rate, $50 million license fee, and March 2026 rollout deadline
- Only existing casinos can operate; sweepstakes-style games would be explicitly banned under new law
HB 298 restricts iGaming licenses to Ohio's current land casinos and racinos. These licensees would receive a $50 million fee for a five-year license, and a $10 million fee for a renewal.
The bill taxes gross iGaming revenue at a 28% tax rate, with 99% of the resulting tax revenue going into the state's general fund and 1% earmarked for preventing and treating problem gambling.
Likewise, the Ohio Casino Control Commission would oversee regulation, and iGaming would be accessible only to those older than 21.
One of the most significant provisions of HB 298 is the inclusion of a firm deadline for implementing online gaming. If passed, the bill would mandate the rollout of iGaming by March 31, 2026. This is one of the few times a state-level iGaming bill has included a predetermined start date.
Arguably, the most critical part of the proposal is its prohibition on sweepstakes casino gaming websites. Ohio joins the likes of New Jersey, Louisiana, and Maryland in introducing legislation banning social casinos.
Sweepstakes casinos unwelcome in new bill
HB 298 defines an "online sweepstakes game" as an online or mobile-enabled game that uses virtual currencies to win real cash or cash-equivalent prizes. While not overtly outlawed under state law, this is tantamount to gambling. With this provision, the bill aims to eliminate loopholes that have allowed unlicensed operators to thrive with minimal regulation.
The bill follows on the heels of a previous iGaming bill - Senate Bill 197 (SB 197) - presented earlier in May by Sen. Nathan Manning. Although both bills propose legalizing Ohio online casinos, they do so quite differently in terms of structure, specifically concerning taxes and market access.
SB 197 would create a more severe taxing regime, including a 36% rate for Ohio-based operators and 40% for operators without an in-state presence. Out-of-state operators would also face a significantly higher license fee of $100 million, compared to $50 million for currently operating operators in Ohio.
In addition, the legislation seeks to legalize iLottery offerings and has a measure to reduce the tax rate on sports wagering by casinos on land from 20% to 10%.
During a recent Senate Select Committee on Gaming hearing, Sen. Manning argued that the state could net $300 million to $1 billion annually from the legalization of iGaming. A second hearing of SB 197 is scheduled for May 22.
