SF1941

This Minnesota Senate bill (S.F. No. 1941) proposes changes to the taxation of lawful gambling. Specifically, it seeks to:

1. Implement a Flat Tax Rate – The bill subjects all lawful gambling receipts to a flat tax rate of 8.5% on gross receipts, after deducting prizes paid.

2. Repeal the Combined Net Receipts Tax – It eliminates the existing combined net receipts tax, which previously applied different tax rates based on the level of gambling receipts.

3. Amend Existing Tax Code – The bill modifies Minnesota Statutes 2024, section 297E.02, subdivision 1, to reflect the new flat tax structure.

4. Preserve Exceptions – The tax does not apply to:

   • Paper or electronic pull-tab deals or games
   • Tipboard deals or games
   • Electronic linked bingo
   • Certain items listed under existing statutes.

5. Maintain Other Local Fees – While local taxes and license fees are eliminated under this bill, it allows for the continuation of certain fees authorized under section 349.16, subdivision 8, and specific taxes allowed under section 349.213, subdivision 3.

6. Tax Payment Responsibility – The bill clarifies that the organization or party conducting the gambling is responsible for paying the tax.

The overall goal of the bill is to simplify gambling taxation by replacing the combined net receipts tax with a single flat rate tax, potentially making compliance and administration easier for gambling organizations.