DENVER (AP) – Colorado Republicans criticized a recommendation Tuesday to make casinos pay taxes under a single license so the state can collect millions more dollars from the businesses each year.
The recommendation from the Colorado auditor’s office calls for regulatory changes that auditors say will make the tax structure more equitable.
An audit of the Division of Gaming, which sets and enforces rules for state casinos, found the state would have collected about $4.9 million more in gambling taxes if casinos operated under a single retail license, as opposed to having separate licenses for separate casinos that are in the same building.
Gaming tax revenue paid to the state during the last five years has averaged about $106 million annually.
Auditors said in their report that the Division of Gaming should “eliminate the tax advantage gained by ownership groups with multiple physically attached casinos.”
The state’s current tax structure is graduated, meaning casino owners pay a higher rate as their revenues surpass various thresholds. Auditors said that means business owners with multiple licenses are paying less in gambling taxes than if they had one retail license with a larger amount of total revenue.
But Republicans on the Legislative Audit Committee, which heard the recommendation, said the auditor’s proposal did not take into account that the each casino may have separate ownership structures and operating costs for each casino license.
Rep. Brian DelGrosso, a Loveland Republican, dismissed the idea of a tax advantage, saying the costs to operate three casinos often exceed what business owners pay to run one.
“You got three separate sets of rents, you got three different sets of employees, utilities. I mean, all of the overall costs that are out there,” DelGrosso said.
The Division of Gaming said it partially agreed with the audit’s recommendation, saying it’s an issue that warrants further discussion and officials have scheduled a hearing on the topic. But gaming officials added that it’s a “complex issue” that will require examining various factors and testimony from interested parties.
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