Gaming ControlAs the old way weren’t as successful as it should be, were anyone seeking a gaming license had to be approved by a local five member board made up of the sheriff, the local district attorney, and three country commissioners, the lack of screening the applicants lead to number of a licensed operators that had connections with the organized crime. While gaming continued to prosper, Nevada’s legislature realized that they needed to make changes and clean up the industry.
Gaming Control Board was created by the legislature in 1955. The Board responsibility was to keep the undesirables out of the industry. To achieve this task they began to conduct background investigation of each gaming license applicant.
Main three objectives are:
- Honesty of gaming is accomplished by the prevention of cheating by both the casino management and the player.
- Corruption free industry, preventing any unsuitable or undesirable person to have any direct or indirect involvement in gaming.
- Taxes are properly paid, maintaining a strict control over the financial practices of licenses.
The Gaming Commission has two primary responsibilities:
- To enact all gaming regulations
- To serve as the final authority on all licensing and disciplinary matters.
In Nevada, gaming tax is calculated as follows: preceding month’s gross gaming win minus any credit issued during the month that is still outstanding at the month’s end, plus any previously issued credit that is collected during the month, equals the gross gaming win figure on which the tax is assessed. The rates are: 3.5% on gross gaming revenues of $50 000 or less per month, 4.5% on next $84 000, 6.75% on gross gaming revenue greater than $134 000.
As we can see above, Nevada’s policy is good for Casino Operators in this jurisdiction, as the tax is payable only on the cash collected by the casino, giving the operator a space for issuing casino credits.
However, in Atlantic City, there is a different picture. The tax in Atlantic City is 8% of the adjusted win paid on annual basis. The adjusted win equals to the gross win minus the smaller of 4% of the gross win or the provision of the bad debt. Meaning that casino operators need to pay tax on issued casino credits that are not collected yet.
To ensure that casino licenses are properly paying their taxes, Regulation 6 was introduced. Regulation 6 requires each no restricted licensee to maintain detailed records pertaining to any revenue subject to gaming taxes or fees for a period of 5 years. In Nevada, each casino presents it’s own system of internal controls to the board, it is evaluated, individually, against a set of basic minimum standards of operation and controls. In New Jersey, all systems of internal controls are prescribed by statue and leave little room for innovation or changes