Lawmakers Looking to Tax, Regulate Daily Fantasy Sports

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Published on:
Apr/19/2017

CONCORD, N.H. (Associated Press) -- Fantasy sports companies estimate more than 200,000 people in New Hampshire are participating in their games.

Lawmakers are looking to get in on a piece of the cash.

A bill before the Senate on Thursday would make New Hampshire the latest state to legalize, regulate and tax fantasy sports run by companies such as DraftKings and FanDuel. Companies running fantasy games for the general public would have to register with the state, pay up to $5,000 annually and face a 5 percent tax. In fantasy games, players build fictional rosters of real athletes to compete against others for money. Players themselves wouldn't be taxed.

The state wouldn't see much money immediately, said Republican Rep. Gary Azarian, the bill's sponsor. But as the popularity of the games grows, New Hampshire would benefit, he said.

"It's going to be a global entertainment industry, the state of New Hampshire can get in on the ground floor of this," Azarian said.

DrafKings and FanDuel support the regulation, viewing it as a way to ensure they can continue operating. Nationally, a debate is raging over whether daily fantasy sports constitute betting or a game of skill. Both companies temporarily shut down in New York state last year after the attorney general sued, asserting the games constituted illegal gambling. They resumed operations in the fall under new regulations.

Eleven other states have regulations in place, said David Collins, a New Hampshire lobbyist for the two companies. By comparison, New Hampshire's taxes and fees are on the low end. New York, for example, charges operators $50,000 and a 15 percent tax.

The industry will be regulated by the New Hampshire Lottery Commission, which also oversees racing and charitable gaming. Charlie McIntyre, executive director of the commission, said he doesn't view fantasy sports as similar to sports betting. But, he said, regulation offers an opportunity to ensure the companies are not taking advantage of players.

"You want to make sure the consumers are getting what they're promised," McIntyre said.

The bill says no one under 18 can play fantasy sports and sets up protections to make sure players are paid what they are owed.

If the bill clears the Senate, it will head to Republican Gov. Chris Sununu's desk. A spokesman said he has "serious concerns" about the bill but would not elaborate.

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