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Pennsylvania Oct. 13 Skill Game Deadline Nears as New Regulation Plan Surfaces

By jili tutorial · September 3, 2026

Pennsylvania Oct. 13 Skill Game Deadline Nears as New Regulation Plan Surfaces

New Proposal Emerges Amid Court-Imposed Deadline

A fresh regulatory plan for skill games in Pennsylvania has surfaced as lawmakers race against an Oct. 13 safe-harbor deadline. The deadline follows a state Supreme Court ruling that classified skill machines as slot machines subject to existing gambling laws. Representative Russ Diamond is now circulating a co-sponsorship memo outlining a two-bill package that would both regulate and tax skill games, while also making broader changes to Pennsylvania’s gambling framework.

Diamond has not yet formally introduced the legislation and is currently seeking co-sponsors. His proposal marks the latest attempt to create a regulatory framework before the court’s 120-day stay expires.

Background: The Supreme Court Ruling and the Oct. 13 Clock

In June, the Pennsylvania Supreme Court ruled that Pace-O-Matic’s Pennsylvania Skill machines fall under both the state’s Gaming Act and criminal gambling laws. That decision overturned lower court rulings that had allowed the machines to operate outside the regulated gambling system. Recognizing that many businesses rely on skill games, the court delayed enforcement of its ruling for 120 days—until Oct. 13—and explicitly left lawmakers an opportunity to act before that date.

Diamond’s Proposed 20% Tax on Skill Games

Diamond’s first proposed bill would tax gross terminal revenue from skill machines at 20%. The plan would allow up to five machines at clubs, liquor-licensed restaurants and bars, and qualified truck stops. Notably, the co-sponsorship memo does not mention a statewide cap on the total number of machines.

The proposal would reshape where skill games can operate. Currently, these machines are found in a wide range of businesses, including convenience stores, gas stations, grocery stores, and tobacco shops. The Pennsylvania Gaming Control Board estimates that between 70,000 and 100,000 machines are in operation across the state.

Diamond’s proposal also calls for adjusting the tax rate for casino slots and all online casino games to 49.9%. At present, casino slots are taxed at 48–54%, while online slots are taxed at 54%. Under the plan, gaming tax revenue would be consolidated into the State Gaming Fund, with 79% directed to property tax relief, 13.25% to the General Fund, 6.75% to the Race Horse Development Trust Fund, and 1% to the Compulsive and Problem Gambling Treatment Fund.

A second bill in the package would establish the mechanism for distributing those payments.

Years of Skill Game Proposals Have Gone Nowhere

Diamond’s plan is the latest in a long line of attempts to regulate skill games—an issue Pennsylvania lawmakers have struggled to settle for years. Governor Josh Shapiro proposed regulating the machines in his last two budget addresses. Most recently, he backed a 52% tax, a statewide cap of 40,000 machines, and a five-machine limit per establishment. Other lawmakers have pushed lower tax rates or alternative fee structures, including a 16% tax proposal and a separate $500 monthly fee per machine.

Representative Ben Waxman introduced HB 2557 in May, which focused on consumer protections such as centralized monitoring, player identification, self-exclusion, age verification, and loss limits—without setting a tax rate.

Unlike previous legislative sessions, however, lawmakers now face a court-imposed deadline. Despite that added urgency, legislators again failed to reach an agreement during this summer’s budget negotiations. Skill game regulation was omitted from the $50.8 billion FY 2026/27 budget signed by Shapiro in July.

Diamond may also face an uphill battle because his proposal goes beyond skill games and seeks to overhaul Pennsylvania’s entire gambling framework. ABC27 reported skepticism at the Capitol about whether lawmakers can agree on such a sweeping package, given their inability to settle the skill game issue alone—especially with the Oct. 13 deadline approaching.