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A Missouri House committee is considering a bill that would significantly increase taxes and fees on the state’s casino industry. As lawmakers search for new revenue to replace Missouri’s income tax, gaming has emerged as a potential source.
That search has taken on new urgency in recent weeks. Missouri lawmakers have advanced a broader plan to eliminate the state’s income tax, with a proposed constitutional amendment now moving through the legislative process and toward a potential statewide vote later this year.
If enacted, House Bill 3533 could reshape how the casino industry operates in the state while helping fill part of a multibillion-dollar revenue gap tied to the proposed tax overhaul.
Bill targets casino and sports betting taxes and fees
The legislation, House Bill 3533, was introduced by Rep. Jeff Knight, R-Lebanon. It targets casino taxes and fees that have gone unchanged since Missouri’s first casinos opened in 1994 and introduces new charges on the state’s recently launched sports betting market.
HB 3533 applies to all 13 casinos licensed to operate in Missouri, as well as sports betting operators. Among other changes, it would raise the casino admission fee from $2 per person to $5.50 per person. The proposal would also require the fee to be charged every two hours during a visit, rather than once per visit, with increases tied to inflation.
One new charge, the “remote wagering access fee,” would be set at 1.5%. The first $35 million collected would be directed to the Department of Natural Resources’ Historic Preservation Revolving Fund.
The bill would also impose an additional 13% tax on gambling receipts and a 24% tax on sports wagering receipts. In addition, $15 million in net proceeds from the Missouri Gaming Commission Fund would be reallocated to the historic preservation fund.
Gaming industry opposes proposed increases
Supporters of HB 3533, led by Knight, say the current fee structure is outdated. Rep. Tim Taylor, R-Bunceton, said gambling and lottery revenues have not kept pace with the state’s needs, noting the admission fee has remained unchanged for more than 30 years.
Rep. Barry Hovis, R-Whitewater, said adjusting the original $2 fee for inflation would bring it to about $4.31 today. He noted casinos currently cover the admission fee for patrons, meaning operators have benefited from its declining real value while state revenues have stagnated.
Hovis added that updating fees is part of Missouri’s broader effort to move toward a fee-based budget model rather than one reliant on income tax.
The gaming industry has pushed back. Mike Winter, a lobbyist for the Missouri Gaming Association, testified that the bill could cost the industry more than $500 million. He said casinos are already facing revenue pressure from slot machines in convenience stores and gas stations and warned the proposal could make Missouri less competitive with other states.
Winter also raised legal concerns, arguing that because voters approved sports betting through a constitutional amendment, changes to its tax structure may require a separate process. Committee chair Rep. Jeff Myers, R-Warrenton, acknowledged the concern and said the sports betting provisions could be addressed separately.
Chance Hepola, representing the Missouri Chamber of Commerce and Industry, also opposed the bill. He urged lawmakers to proceed cautiously when raising taxes on a specific sector, warning it could put certain industries at a disadvantage.
Missouri sports betting revenue falls short of expectations
HB 3533 comes as Missouri’s sports betting market is still in its early stages, having launched Dec. 1, 2025. Operators handled nearly $1 billion in wagers during the first two months, but the state collected less than $700,000 in tax revenue over that period.
Under current law, operators can deduct promotional expenses from taxable revenue. HB 3533 would instead tax sports wagering revenue before those deductions, increasing the state’s taxable base.
Knight said the bill could generate an estimated $470 million, though industry representatives have disputed that figure.
Missouri income tax repeal gains momentum
The push to increase gaming taxes comes as Missouri lawmakers move rapidly on a plan to phase out the state’s income tax—one of the largest sources of state revenue.
In April, the Missouri Senate approved a revised version of a proposed constitutional amendment to eliminate the income tax and sent it back to the House for further action. The measure has since cleared key legislative hurdles and is expected to go before voters later this year, potentially as soon as the November ballot.
If approved, the plan would allow lawmakers to expand sales taxes and other revenue sources to replace billions of dollars currently generated by income taxes, which account for roughly two-thirds of the state’s general revenue.
Estimates suggest the transition could create a multibillion-dollar gap in the short term, increasing pressure on lawmakers to identify alternative funding streams such as real-money online casinos.
What comes next
As first reported by the News Tribune, Missouri lawmakers have until May 15 to pass legislation. HB 3533 has received a public hearing but remains in committee and has not yet been placed on the House calendar.
With the broader tax overhaul advancing quickly, measures like HB 3533 could play a key role in shaping how Missouri replaces lost revenue—if they gain traction before the legislative deadline.
