The Connecticut Attorney General is pouring cold water on a new plan to tax daily fantasy sports sites that operate in the state. He’s worried that proceeding with the plan could jeopardize the state’s current gambling compacts with tribal gaming interests.

At issue is a proposal being considered by the Connecticut State Senate to tax daily fantasy sports entries at 8.75%. The Senate recently asked Attorney General George Jepsen for a formal legal opinion on the plan – the answer he gave them was probably not the one they were expecting.

In Jepsen’s view, the proposed tax on (and tacit approval of) daily fantasy sports would be a violation of the state’s current agreement with the Indian tribes that operate the massive Foxwoods Resorts and Mohegan Sun Casinos.

Those two tribes, according to a report on CTMirror.com, were granted a quasi-monopoly with regards to Connecticut gambling. That compact they signed with the state says the two tribes have an exclusive right to, “commercial casino games,” in the state.

Currently there’s no clear consensus on whether or not daily fantasy sports counts as gambling or not, and that’s a very troubling issue for a Jepsen. He’s worried that if the state violates its agreement with tribal gaming interests by collecting taxes on daily fantasy sports, they won’t be able to continue collecting taxes from the tribes.

Though the Connecticut tribes are hardly the juggernauts they once were, they still contribute mightily to Connecticut state coffers. Last year tribal gaming paid out more than $200 million in taxes on their games.

Given the likelihood that daily fantasy sports could ever produce that kind of revenue, it’s unlikely that the Senate will proceed with their plan.


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