A lawmaker in Virginia is making another attempt to bring online casino gaming to the state after a previous effort failed during last year’s legislative session.
Del. Marcus Simon is aiming to bring online casinos to the Old Dominion by introducing House Bill 161, a bill that proposes amending and reenacting the Code of Virginia to allow the legalization of iGaming with regulation by the Virginia Lottery Board. Under HB 161, the board is provided with the right to issue permits and licenses for online casinos. HB 161 establishes a framework for both iGaming operators and platform providers.
The measure provides retail casino operators with the opportunity to apply for an iGaming license, with an initial licensing fee set at $500,000. Under HB 161, licenses are valid for five years with a renewal fee for an additional term set at $250,000. Operators are also allowed to offer up to three online casino skins. The ability for casinos to offer up to three skins also comes at a price of a $2 million “platform” fee. Prospective online casino skins are also required to pay a $50,000 license application fee. The funds are to be deposited into the Internet Gaming Platform Fee Holding Fund.
Simon’s measure from 2025 also proposed allowing casinos to offer up to three skins.
HB 161 also lays out penalties for offering online casino gaming without proper licensing. The bill considers any person who provides iGaming without a license to be guilty of a Class 6 felony, with violators subject to a fine up to $25,000. Any corporation that offers online casino gaming without a license is subject to a fine of up to $1 million.
Simon’s proposed tax and live dealer rules
Simon’s measure proposes placing a 15% tax rate on adjusted gross revenue for online casino gaming. The State Lottery Department is responsible for collecting and allocating the tax revenue, with 5% to be deposited into the Problem Gambling Treatment and Support Fund. HB 161 also mandates that the department allocate 6% of the revenue to the Internet Gaming Hold Harmless Fund until 2030. After Jan. 1, 2030, the department will allocate 95% of the revenue toward the General Fund.
Simon’s online casino bill from 2024, House Bill 2171, also proposed a 15% tax rate.
HB 161 allows licensed operators to deliver online casino simulcasts from any live dealer studio in any location, with operators also allowed to deliver live content from Virginia. The live dealer studios are only able to deliver content if licensed as an iGaming supplier.
HB 161 mentions sweepstakes games
A difference between Simon’s effort in 2026 compared to last year is the inclusion of sweepstakes games. HB 161 prohibits unlicensed online casino operators from offering online casino sweepstakes games that pay or proffer “something of value, including an entry fee for the opportunity to win or receive cash or a cash equivalent.”
Penalties for offering sweepstakes casino games as an unlicensed operator include a civil penalty up to $100,000 for the first offense and up to $250,000 for the second. HB 161 allows the board, Office of the Attorney General and Virginia State Police to investigate potential violations with cease and desist letters and subpoenas on the table.
Simon’s previous online casino effort fails
Simon introduced HB 2171 early last year but the piece of legislation was quickly no longer under consideration after the General Law subcommittee for the Virginia Alcoholic Beverage Control Authority recommended laying the bill on the table, ending its chances to become law. A fiscal note of the measure raised cannibalization concerns regarding online casinos and iLottery. Virginia’s iLottery operations have emerged as a vital revenue source. According to data provided by the Division of Legislative Services, iLottery operations in Virginia generated $2 billion in handle between July 2022 and June 2023.
Simon projected Virginia to generate up to an additional $5.3 billion in new taxable revenue over a five-year period from online casinos, with his data also addressing cannibalization concerns. Simon estimated a roughly 8.4% uptick in revenue for land-based casinos.
