Georgia Lawmaker Challenges 13 Percent Tax Rate on COAM Skill Games
TL;DR — Sen. Bill Cowsert argues Georgia’s COAM skill games at 13% tax fall short of the Lottery’s 35% mandate, which has never topped 27%. Schneider counters with 42.5% retention splits plus $50M+ in extra fees and urges more locations over rate hikes. The dispute centers on balancing returns for HOPE and pre-K programs.
SCCG Take — Operators should anticipate sustained legislative focus on effective tax contributions, requiring clear demonstration of regulatory compliance and revenue support to preserve expansion options.
Outgoing state Sen. Bill Cowsert (R) maintains that Georgia’s coin-operated amusement machines, known as COAMs or skill games, do not deliver sufficient returns to the state. Administered by the Georgia Lottery, these devices operate at a 13 percent tax rate. That figure rose from 10 percent in 2013, though Cowsert sought 30 percent during the 2024 session.
The Lottery must return 35 percent of proceeds to state coffers but has never exceeded 27 percent, according to Cowsert. He contends this creates an imbalance, with COAMs cannibalizing lottery sales while yielding lower returns than those seen in neighboring states. Georgia fields as many as 7,360 machines, one for every 1,549 residents in a population of 11.4 million. The revenue supports the HOPE Scholarship and pre-kindergarten programs.
Lawmaker’s Case for Tax Parity
Cowsert notes net profits to the state have grown year over year yet argues greater profitability from COAM sales remains available. He cited an Illinois 33 percent rate on slot-route operations as closer to national norms. Legislators approved only a 3 percent increase rather than the larger jump. Cowsert views gift cards as cash equivalents and questions the gap from standard benchmarks. He estimates sports betting might generate $50 million to $100 million yearly against the Lottery’s $1.6 billion.
Industry Counter on Taxes and Growth
Atlanta attorney Les Schneider, representing the Georgia Amusement & Music Operators Association, states the sector already pays the highest taxes in the state. Master licensees and host vendors each retain 42.5 percent, with local taxes, property taxes, sticker fees, and licenses adding more than $50 million annually on top of the gross-receipts tax. Schneider advocates expanding permitted locations under clear rules to lift state revenue instead of rate hikes. He distinguishes COAMs as skill-based devices with non-cash rewards capped at $5 per win, contrasting them with slots. The industry maintains neutrality on broader gambling legalization and credits the Lottery for regulatory certainty.
As reported by CDC Gaming, the exchange reflects ongoing calculations over education funding sources in a stable but scrutinized sector.
Reporting: CDC Gaming
Generated by SCCG’s automated editorial system from published source reporting. SCCG Management holds editorial responsibility.
Georgia's skill-game tax fight is really about maximizing HOPE funding without killing the golden goose or blocking sports betting.
We've advised on tax structure and competitive positioning in nineteen regulated markets. Georgia's debate—skill games at 13% versus lottery's mandated 35%—sets the blueprint for how states balance education revenue, existing verticals, and expansion. Operators need to prove total contribution, not just headline rates, or face lawmakers who see untapped upside.
- Sen. Cowsert wanted 30% COAM tax; settled for 13%, citing Illinois' 33% slot-route rate
- Industry says 42.5% retention splits plus $50M+ in fees already exceed lottery's 27% actual return
- 7,360 machines fund HOPE scholarships; dispute centers on location growth vs. rate hikes
SCCG angle: SCCG works with lottery vendors, skill-game manufacturers, and state regulators across the U.S. We help clients build the total-economic-impact narrative—license fees, local taxes, jobs—that turns tax debates into partnership conversations and keeps expansion on the table.
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