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Hint: The house wins. 

 

By law, electronic games of skill at Southland and Oaklawn are required to pay out at a rate of 83 percent or more over the life of a machine.

Gaming Laboratories International, which monitors the machines, makes a monthly report to the state on total payouts, but the machines are not required to meet the 83 percent target on a month-to-month basis.

In order to meet the 83 percent target and to stay competitive with other casinos in the region, Shelby McCook, manager of the state Racing Division, said the manufacturer actually sets the machines to pay out at a rate of 91 percent, though the payout may vary depending on time periods.

In simple terms, that means, on average, if you put $100 into the slot of a machine, you can expect to get $91 back (if, that is, you set aside your winnings and don’t plug them back into the machine).

The state tax on electronic machine wagering is 18 percent of the net. That means an effective tax rate on all machine wagering, at the 91 percent payout, of about 1.6 percent.

By comparison, the state puts a 1 percent tax on wagers on live horse and dog races, simulcast racing and the Instant Racing machines, which also pay out on the pari-mutuel system.

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