Gambling tax proposal changes again

The city of Oak Harbor’s new gambling taxes will likely be significantly lower than originally proposed.

Under an ordinance that will come to council next meeting, taxes on pull tabs, punch cards, raffles and social card games would be set at 1 percent and bingo would be 5 percent. Nonprofits won’t have to pay.

At their Tuesday meeting, council members had a thorough discussion of a proposed amendment to the ordinance following a citizen’s complaint about a 5 percent tax on social card games.

Mike Reedy, manager of Oak Bowl’s card room, said he currently runs the only game in town and the profit margins are very tight. He said the game attracts a handful of older people and barely breaks even; the city’s tax collection would be small.

“It’s more like adult night care,” he said. “That’s what I call it.”

Reedy said the proposed tax increase would likely mean the end to the game.

Several of the council members questioned how much the tax would really raise for the city.

Councilman Rick Almberg asked if it would amount to “pocket change.”

Based on numbers presented by Finance Director Patricia Soule, a doubling of taxes on pull tabs and punch cards could bring in an extra $12,000 to the city, which would be dedicated to public safety.

The city currently only taxes bingo and pull tabs, but the proposal would add raffles, amusement games and social card games to the list.

Since they would be new taxes, the income would be hard to estimate.

Earlier this year, City Attorney Nicki Esparza presented the council with an amended version of the city’s gambling tax ordinance as part of her ongoing review and correction of city code. The council asked during a workshop to change some of the tax rates.

Esparza brought the amendment back to the council meeting and the majority of council members wanted more changes.

In the end, the majority of council members agreed with Councilwoman Beth Munns’ idea to set gambling taxes at 1 percent, but with bingo being at 5 percent. The amendment also exempts nonprofits from the tax and cleans up language in the code.

The amendment will be on the next council meeting for final approval.

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