The New Jersey Assembly's Tourism, Gaming, and the Arts Committee meeting on October 24, 2024, spotlighted the critical balance between legal and illegal gaming markets, with industry leaders warning that rising tax rates could drive customers back to illicit options. A key discussion point was the potential impact of a 5-6% tax increase, which could significantly alter the competitive landscape, pushing knowledgeable gamblers towards illegal markets.

Industry representatives emphasized that a small percentage of customers generate a large portion of revenue, and maintaining a competitive edge is vital. They highlighted the importance of responsible gaming initiatives funded by profits from legal operations, underscoring that higher taxes could jeopardize these efforts. "It's not sustainable for businesses to exist and do all the things that we think are most important," one speaker noted, stressing the need for a balanced approach to taxation.

The meeting also addressed the relationship between online gaming and brick-and-mortar casinos. Contrary to fears of cannibalization, a commissioned study revealed that online gaming could actually drive more customers to physical casinos, enhancing brand recognition among younger audiences. "What we're seeing is that this is allowing another stream of revenue," a representative stated, reinforcing the idea that both forms of gaming can coexist and benefit each other.

Artificial intelligence (AI) was discussed as a tool for improving responsible gaming practices. Industry leaders are optimistic about AI's potential to enhance customer monitoring and support, ensuring that at-risk individuals receive timely assistance. "AI is going to help address many of the things that we've discussed today," one participant remarked, highlighting its role in fostering a safer gaming environment.

As New Jersey continues to navigate the evolving gaming landscape, the discussions from this meeting underscore the importance of strategic tax policies and innovative technologies in sustaining a robust legal gaming market while addressing the challenges posed by illegal operations.