Gambling Legislation

Indiana iGaming Bill Advances, With Surprise Sports Betting Tax Amendment

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A bill to legalize online casinos takes its first step in the state

Indiana’s push to legalize online gambling took a step forward as House Bill 1432 cleared the House Public Policy Committee in a 9-2 vote. The bill aims to modernize the state’s gaming landscape by legalizing iGaming while also expanding responsible gambling initiatives.

The measure, introduced by Rep. Ethan Manning, is projected to generate over $300 million annually through taxation. A last-minute amendment raised the tax rate on online sports betting from 9.5% to 20%, a change that caught many by surprise.

Supporters argue that the bill would help regulate an industry already being accessed through unlicensed platforms while providing consumer protections and state oversight. Some illegal operators have even used Indiana’s official seal to mislead residents into thinking their services are legal.

Casino representatives have been vocal in their support, emphasizing that the legislation would bring much-needed oversight to online gaming. However, some responsible gambling advocates raised concerns about the potential for increased addiction, citing the ease of access and rapid nature of digital betting. A provision within the bill would fund new problem gambling treatment programs, marking a shift from previous efforts that focused primarily on awareness.

If passed, Indiana casinos and racetracks would be eligible to apply for iGaming licenses. Operators would initially face a 26% tax rate, with a tiered structure taking effect after July 2026, ranging between 22% and 30% based on revenue. A launch date of September 1, 2025, has been proposed.

The Hoosier Lottery has also backed the initiative, citing online expansion as a way to sustain revenue while contributing additional funds toward responsible gambling programs. With bipartisan support, the bill now moves to the full House for further debate.

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