Pennsylvania sweepstakes casino ban bill faces narrow legislative window
A newly filed bill would outlaw sweepstakes casinos in Pennsylvania and fold skill-game terminals into the state's regulated system, but lawmakers have only weeks left to act.
Pennsylvania's largest-in-the-country online casino market could become the next state to outlaw sweepstakes casinos, after Republican state representative Russ Diamond filed House Bill 2801 last month.
The bill has been sent to the House Gaming Oversight Committee, which Diamond chairs. It carries four co-sponsors: Republicans Jacob Banta, Dan Moul and Brad Roae, and Democrat Jeanne McNeill.
Under the proposal, operating, running or marketing an online sweepstakes casino in Pennsylvania would become unlawful, with penalties ranging from $50,000 to $500,000 for each violation.
The legislation defines a sweepstakes game as one built on a dual-currency structure that lets players convert virtual credits into cash, prizes or cash equivalents while mimicking casino-style play. Products that pay out no cash or cash equivalent would be exempt.
Anyone who helps administer, operate or promote such games could also be caught by the ban, though unlike recent laws in California and New York, the Pennsylvania bill does not single out specific payment processors, geolocation firms or media partners by name. That leaves enforcement scope to the Pennsylvania Gaming Control Board, known as the PGCB, and the state attorney general, who would gain powers to investigate, issue subpoenas and order operators to cease and desist.
The PGCB has previously sent warning letters to sweepstakes operators but lacked any legal authority to enforce them, and the regulator has asked lawmakers for help closing that gap, according to SBC Americas.
Time is short. The 2025-26 legislative session ends on 30 November, with only five scheduled voting days remaining, and bills that do not pass cannot be carried into the next session. If HB 2801 stalls, a similar ban could be reintroduced in 2027 — a pattern already under way elsewhere, with a Wyoming committee recommending its own sweepstakes ban for next year and Virginia expected to revisit legislation that was sent to study earlier in 2026.
The bill is tangled up with Pennsylvania's separate fight over skill-game terminals. In June the state Supreme Court ruled that the machines qualify as slot machines under the Gaming Act, staying its ruling for 120 days. That stay expired this week, and as of Wednesday, 14 October, state police can seize the devices and pursue criminal charges against operators found outside PGCB-licensed casinos or truck stops. Police have said simply unplugging a machine does not satisfy the ruling. The Altoona Mirror reported roughly 70,000 of the devices were in operation statewide before businesses scrambled over the weekend to remove them.
HB 2801 would pull those terminals into the PGCB's existing video gaming terminal framework, permitting them at liquor-licensed restaurants and clubs in addition to truck stops, with a cap of five machines per location. It would also cut the tax rate on those terminals from 42% to 20%.
On the online casino side, the bill would replace Pennsylvania's current 54% tax on online slots with a flat 49.9% rate covering online slots, table games and poker, while raising the sports betting tax from 34% to 36%.
That tax plan clashes with the approach favoured by Democratic Rep. Pat Harkins, the committee's majority chairman, who told the Erie Times-News in July that any skill-game tax needed to match the existing casino rate of 55%. Democrats hold a narrow 103-100 majority in the House, giving Harkins significant leverage over whether Diamond's bill advances.
Pennsylvania generated $3.46bn in online gambling revenue in 2025, the highest total of any state, and the PGCB reported iGaming revenue of $245.7m in August alone, up 6.25% year-on-year and producing $113.5m in tax revenue that month. Thirteen states have now banned sweepstakes casinos by law, including fellow iGaming markets New Jersey and Connecticut.