03/01/2010 1:00AM

Ky. House passes account-wagering tax

Email

A bill that would add a 0.5 percent tax to all wagers made by Kentucky residents through account-wagering operations on Kentucky races was passed by the Kentucky House late Friday.

The bill, which would raise $400,000 annually, according its sponsors, was passed by a vote of 85-8, with one abstention, and was sent to the Senate. The Kentucky racing industry has not acknowledged supporting or opposing the bill.

Under the bill, one-third of the money raised by the tax would go to the Kentucky Horse Racing Commission. The other two-thirds would be split by the racetrack that is running live at the time the wager was placed and the purse account at the live racetrack.

Kentucky racetracks currently have one of the lowest takeouts in the U.S., at 17 percent for win, place, and show bets, and 19 percent for all other bets. It is not clear if account-wagering operations would pay the tax directly or if the tax would be applied to the takeout through net-pool pricing. If applied to the takeout, Kentucky account-wagering customers with winning wagers would get slightly lower payouts on Kentucky races than winners in other states.