Pittsburgh council gambles on skill games tax by voting in favor of levy

By JULIA BURDELSKI
TribLive

Pittsburgh City Council on Wednesday voted to tax skill games, though whether the city will ever be able to collect the tax depends on what regulations or levies the state imposes.

The Pennsylvania Supreme Court earlier this month ruled that skill games are slot machines and must adhere to gambling statutes. The ruling gave state lawmakers 120 days to decide how to regulate — and likely tax — the machines.

Councilman Anthony Coghill, D-Beechview, said he hoped Pittsburgh would be grandfathered in and permitted to tax skill games — even if the state later imposes its own tax — if the city’s levy was approved before the state acts.

“Right now we’re at a wait and see,” said Coghill, who sponsored the legislation.

Council’s hope is to have the tax implemented next year with the 2027 budget.

If Pennsylvania begins to tax skill games, it could prohibit municipalities from levying their own taxes on the machines. The city also would be unable to collect a tax if the commonwealth banned the machines outright.

Council approved the bill unanimously Wednesday. Councilwoman Barb Warwick, D-Greenfield, was not present for the vote.

The measure requires businesses get licenses for skill games and pay an annual fee for each machine.

Taxes are tiered based on the type of machines. The highest tier, with a $1,000-per-year fee, would be levied on skill games like poker machines, video slot machines and video sweepstakes machines.

Devices offering prizes like stuffed animals, candy or toys would be taxed $100 annually.

The final class, which would be charged $10 per machine each year, includes darts, pool tables, jukeboxes, pinball machines, shuffleboard machines and children’s video games.

An amendment approved Wednesday will cap the tax so that amusement arcades only have to pay for their first 10 devices.

Coghill has estimated the tax could generate between $2 million and $3 million each year.

Councilwoman Erika Strassburger, D-Squirrel Hill, said she was happy to see a new potential revenue source that didn’t further tax property owners.

The city this year raised property taxes by 20% in response to serious financial struggles.

“This is one of the unique ones that isn’t necessarily all on property owners,” Strassburger said of the skill games tax.

Councilman Bob Charland, D-South Side, supported the tax but said he wished the city could simply outlaw the games.

“I really think these skill games are a pox on our neighborhoods,” Charland said, likening them to vape shops, which recently saw new restrictions. “I hope this makes it harder to establish these throughout the whole city.”