Queens Casino Expansion at Risk: Resorts World NYC Demands Tax Breaks

The gambling landscape in New York is facing a significant standoff. Resorts World NYC has explicitly stated that its planned investments in Queens are contingent on one major factor: the State of New York must improve the tax conditions. For the company, the demanded reduction in tax liability is not a matter of negotiation but a matter of economic survival. Without this adjustment, the entire expansion project is at risk, which could have far-reaching consequences for the labor market and local infrastructure.

Political fronts are currently hardened. While lawmakers from Queens have already aligned themselves with Resorts World's demands, the leadership in Albany shows little sign of compromise. Governor Kathy Hochul is sticking to the current terms, making future planning for the casino significantly more difficult. At stake is a vast amount of money and New York's status as one of the world's most lucrative, yet most expensive, gambling locations.

Numbers and facts

New York is a state of extreme contradictions. If it were its own country, its economy would rank tenth globally. At the same time, the region struggles with massive wealth inequality. Resorts World NYC is one of the largest players in this market and is currently facing tax rates that are considered exceptionally high by international standards. In New York, rates on Gross Gaming Revenue (GGR) are sometimes levied at levels far exceeding those in other US states or European markets. The expansion in Queens is designed as a multi-billion dollar project intended to create thousands of jobs. However, the math only works for the operators if the state waives a portion of its revenue.

"Queens lawmakers are joining Resorts World’s push, saying the casino expansion could otherwise collapse. Governor Hochul isn’t budging." - Nick Garber, Journalist at New York Focus

This stalemate is causing unrest in the industry. Experts point out that the profitability of land-based casinos quickly evaporates under an excessive tax burden, especially when high investments in climate protection and infrastructure are simultaneously required. While New York has passed some of the nation's most ambitious climate laws, it is falling behind on implementation, adding further pressure to large-scale projects like the casino expansion.

Background

The conflict has been simmering for a long time. Resorts World currently operates under a limited license and is seeking one of the coveted full-scale licenses for the downstate New York area. These licenses allow for traditional live gaming like roulette and blackjack, which were previously only permitted in the upstate region. With the expansion, the Queens site is intended to be transformed into a world-class resort. However, competition is fierce, and financial hurdles are high. Other applicants are watching closely to see if the state yields on taxes, as this would set a precedent for the entire region.

The discussion is not just about taxes but also about political power plays. Transparency in such decisions is often criticized. In the last two decades, the number of local news outlets in New York has nearly halved, making it easier for officials to make decisions behind closed doors. However, the Resorts World case shows that economic reality is now forcing politicians to act, as the risk of a complete project cancellation is real.

Why it matters for German players

For German casino fans, the debate in Queens might seem far away, but it illustrates a global phenomenon: the balance between state revenue and the viability of providers. In Germany, the State Treaty on Gambling (GlüStV 2021) regulates the market extremely strictly. Players in Germany should exclusively rely on providers with a license from the Gemeinsame Glücksspielbehörde der Länder (GGL). These are listed on the so-called whitelist. Germany has clear protection mechanisms such as the 1,000 Euro monthly deposit limit via the LUGAS system and the 1 Euro per spin limit for virtual slots.

While New York argues over tax rates that jeopardize projects, the 5.3 percent tax on every stake for online slots and poker in Germany is a topic of debate. This leads to legal providers having difficulty matching the odds of illegal casinos from Malta or Curacao. Nevertheless, only GGL-licensed casinos offer the necessary legal certainty and access to the OASIS exclusion system. Anyone playing in New York or Germany must be aware that high taxes often lead to poorer payout ratios for the player.

What it means for GGL-licensed casinos

The situation in New York is a warning for regulated markets worldwide. If the tax burden becomes too high, necessary investments in player protection and modern technology will not materialize. German GGL casinos must remain profitable to meet the high standards of German regulation. A stable tax environment is the prerequisite for legal offers to remain attractive and for players not to migrate to the unregulated black market. Developments at Resorts World are therefore also being monitored by European regulatory authorities to analyze the long-term effects of high levies on the market structure.