Perhaps no city symbolizes the transformation of the gaming industry as much as Atlantic City. Since its legalization of casino gambling in 1976, Atlantic City has served as a benchmark for states looking to tap into the economic plus tourism potential of gaming. The growing interest is fueled by the revenue potential, tourism appeal, and job creation opportunities gaming can provide.
New York’s gaming industry has steadily expanded, especially after legalizing sports betting in 2019 and online betting in 2022. The state currently hosts 13 tribal and 21 commercial casinos, but the absence of legalized online casino gambling limits its competitive edge.
To enjoy New York online casinos gaming one has to opt the sweepstakes route that has some of the best casino games out there. Despite this, New York’s gaming revenue reached over $4.72 billion in 2023.
The state has adopted a comprehensive approach to gaming regulation, focusing on sustainability and responsible gambling practices. But, the taxes they have to pay are crazy high–way more than most other places in the U.S.
This tax rate is super high compared to most other places in the U.S. and significantly higher than Atlantic City’s 12%, prompting some to question its long-term viability.
Atlantic City’s gaming industry brought over $3.32 billion in revenue in 2023, showcasing its resilience and adaptability. Initially positioned as a casino-exclusive destination, Atlantic City has diversified its offerings, blending entertainment, dining, and cultural attractions.
Despite economic challenges, its tourism plus hospitality sectors remains closely connected with gaming, with over 30% of visitors identifying casino gambling as their primary reason for travel.
The tax structure in New Jersey also contributes to its success. With a 12% tax rate on gross gaming revenue, the state manages a balance between generating significant public funds and fostering industry growth. This balance serves as a template for other states, including New York, which imposes a much higher 51% tax rate on sports betting.
Atlantic City’s gaming success is not solely about casinos. The city’s broader appeal lies in its vibrant boardwalk, luxury hotels, and event venues. For New York, replicating this model involves leveraging its existing tourism infrastructure. Iconic destinations like Times Square or Catskills offer potential for integrated resort experiences, combining gaming with entertainment and hospitality.
Additionally, New York’s proximity to large metropolitan areas and its robust transportation network provides a strategic advantage. By enhancing these assets, the state could attract both domestic and international tourists, much like Atlantic City draws visitors from neighboring states.
A critical aspect of Atlantic City’s model is its ability to balance revenue generation with industry growth. New Jersey’s relatively moderate tax rates and supportive regulatory environment encourage investment while still contributing significantly to public funds. In contrast, New York’s stringent tax policies risk stifling operator enthusiasm and long-term growth.
For example, operators in New York have expressed concerns about profit margins under the current tax structure. The disparity between taxation in New Jersey and New York highlights the need for a balanced approach that incentivizes investment without compromising public benefits
Atlantic City's casinos are doing well, but they still have some problems. The city has faced economic downturns, competition from nearby states, and a reliance on gaming revenues. For New York, avoiding these pitfalls means prioritizing diversification. Beyond casinos, investing in entertainment, technology, and infrastructure can create a resilient gaming ecosystem.
Furthermore, Atlantic City’s experience underscores the importance of addressing social impacts. Problem gambling, economic inequality, and urban decline are challenges that require proactive policies. By adopting a comprehensive approach, New York can mitigate these risks and foster sustainable growth.
The future of New York’s gaming industry hinges on strategic decisions. By adopting a balanced tax policy, promoting online gaming, and investing in tourism infrastructure, the state can emulate Atlantic City’s success. However, it must also innovate, leveraging its unique strengths and addressing the limitations of Atlantic City’s model.
As New York moves towards this path, the lessons from Atlantic City provide both inspiration and caution. With calculated investments and forward-thinking policies, New York could position itself as a leader in the gaming industry, driving economic growth and enhancing its appeal as a tourism destination.
