Virginia sees a second online gambling bill approved

Charlotte Capewell

19 February 2026 at 7:32am UTC-5

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Lawmakers in Virginia have approved another online casino bill amid heated debate over legalization. The House of Delegates approved House Bill 161, which would regulate and tax online casino gaming.

The bill, which passed 67-30 after previously failing 46-49, would place oversight of internet gaming with the Virginia Lottery Board. Operators would have to obtain licenses and pay a 15% tax on profits, which supporters say would bring an already profitable market into a legal framework.

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Delegate Marcus Simon was one of those to speak in favor of the bill. Emphasizing that people were already playing casino games online, he said,“It’s estimated that igaming has a US$12 billion business in Virginia that’s completely unregulated and untaxed. So, what this bill is really meant to do is to bring the gaming on your phone within a legal framework that’s going to be highly regulated and include consumer protections.”

Opposition to the bill was fierce, however. Speaking to ABC 3, Delegate Tom Garrett warned of the danger of addiction and suicide risks, saying, “We don’t tax and regulate things that destroy people, because our responsibility is to try to form a more perfect union. Not to cater to the basal instincts and the greed of people who wish to make money without regard for human life.”

After Garrett’s speech, the bill was defeated 46-49, but eventually passed when it was brought back an hour later. It now moves to the Senate General Laws and Technology Committee for the next stage of debate.

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The measure isn’t the only igaming bill currently under consideration in the Virginia legislature. Earlier this week, lawmakers advanced Senate Bill 118 to the House after a reconsideration vote.

Charlotte Capewell brings her passion for storytelling and expertise in writing, researching, and the gambling industry to every article she writes. Her specialties include the US gambling industry, regulator legislation, igaming, and more.

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The Backstory

Reversal in Richmond set the stage

Virginia’s latest push to regulate online casino gambling turned on a rare mid-session reversal in the House of Delegates. After an initial defeat, lawmakers revived and approved House Bill 161, which would legalize internet casino games under the Virginia Lottery’s oversight and tax operators at 15% of adjusted gross revenue. The bill is posted on the General Assembly’s tracker as HB 161, with the House roll call recorded on the official vote page. Supporters framed the measure as a way to move play already happening on unregulated sites into a tightly monitored market with consumer protections. Opponents warned about access and addiction risks, and about expanding gambling beyond casinos already authorized by voters. The floor drama — an initial failure followed by a reconsideration that yielded a 67-30 passage — underscored how contested the issue has become and foreshadowed a close fight in the Senate.

HB 161 now awaits action in the Senate General Laws and Technology Committee, where it will meet a chamber already tested by its own online casino bill. The House vote also intersects with broader questions that have preoccupied lawmakers for more than a year: whether the lottery can extend its remit from sports betting to full casino-style games, how to square iGaming with brick-and-mortar operations, and how to scale problem gambling safeguards if phones become de facto casino floors.

Senate drama sets the tempo

The Senate’s path on iGaming has been narrow and volatile. Senate Bill 118 narrowly advanced after an initial 19-20 defeat on Feb. 16, then a successful motion to reconsider the same day. The chamber’s split showed bipartisan fractures, with several senators switching or sitting out on the second tally. The bill’s public materials, including the latest text, are posted under SB 118 and the Senate vote is recorded on the official tally page. The Senate version sets a July 1, 2027 launch and channels tax proceeds to education, regulatory and problem gambling funds, reflecting an attempt to balance new revenue with social costs.

Supporters cited a fiscal review estimating US$4.1 billion in net operator revenue over five years and about US$1.1 billion to the commonwealth, with US$818 million in tax distributions to designated funds. Opponents cautioned that 24/7 access on smartphones could escalate harm, particularly for younger men already showing higher-risk profiles in national research. The maneuvering revealed a Senate prepared to revisit the issue under pressure of deadlines, but also a coalition that remains fragile as details on licensing caps, tax rates and launch timing shape who votes yes.

An earlier stumble in subcommittee

Before the Senate floor rescue, the iGaming push ran into resistance at the subcommittee level. The Senate General Laws and Technology Gaming Subcommittee voted 3-4 to stall SB 118, citing timing and regulatory readiness. Lawmakers questioned whether the Virginia Lottery — which already oversees sports betting and the lottery — could absorb casino-style oversight without a dedicated commission. Some warned that standing up a new Virginia Gaming Commission could take years, complicating any near-term rollout. That hearing previewed the questions likely to resurface when the House bill crosses over: who regulates, how fast, and with what guardrails.

The subcommittee debate also amplified the central trade-offs. Proponents argued that legalization would capture play from offshore sites, improve consumer protections such as self-exclusion and deposit limits, and bring in steady tax revenue. Skeptics focused on retail cannibalization risks and the social costs of ubiquitous access. The narrow subcommittee margin showed how a few votes can swing the outcome, a dynamic that has repeated across both chambers this session.

From study panels to a live fight

This year’s edge-of-the-knife votes grew out of a longer process that began with a pause. In late 2024, lawmakers shelved an earlier proposal, SB 827, to allow time for study of iGaming’s impact and the feasibility of creating a Virginia Gaming Commission. At a joint subcommittee meeting, legislators heard presentations on revenue potential and public health risks, weighing claims that online casinos could generate as much as US$5.3 billion in taxable revenue over five years against research highlighting elevated addiction risks for men ages 18 to 35. The committee planned at least two more sessions, signaling that any legalization would need to pair revenue goals with data-driven protections.

Those study sessions set the contours of the current debate. Advocates for a lottery-led model say Virginia already has a competent regulator and that rapid rulemaking is feasible, pointing to the state’s quick sports betting launch. Others argue a commission could centralize casino, sports and online oversight, give regulators more specialized tools and insulate policy from market pressure. The tension between speed and structure is now playing out as HB 161 and SB 118 advance on parallel tracks.

Revenue, regulation and the political math

The stakes are straightforward: money, market integrity and political risk. HB 161’s 15% tax rate would be among the more moderate in the country, a level supporters say is high enough to fund programs and low enough to keep legal sites competitive with offshore operators. SB 118’s framework, posted in the latest substitute text, spreads proceeds among education, regulatory and treatment funds, attempting to lock in broad-based benefits.

But the hard part is less the math than the map. Retail casinos in Bristol, Danville, Norfolk and Portsmouth are still scaling up, and Richmond set a careful precedent by requiring local referendums for brick-and-mortar approvals. Lawmakers must decide whether geofenced online markets tied to existing casino licensees, a lottery-centric system or a hybrid model best preserves local investment while meeting consumer demand. The Senate’s razor-thin reconsideration and the House’s whiplash floor sequence suggest neither approach has a commanding majority without concessions on licensing limits, advertising rules and mandatory tools like cooling-off periods and robust self-exclusion.

Virginia is also legislating in a moving national market. Nearby states are recalibrating how and where betting is permitted, often to corral activity already happening online. Nebraska is pursuing a 2026 ballot strategy to decide mobile wagering, with two petitions cleared for signature gathering that would tether operators to racetracks and earmark a 20% tax for local governments and property tax relief. In Wisconsin, a bill would clarify that mobile bets are legal if servers sit on tribal land, a bid sponsors say would keep play within compacts and in state, as outlined in coverage of the tribal-backed proposal. Those efforts echo Virginia’s central question: regulate the activity people already access on their phones or leave it to an unlicensed shadow market.

What comes next in Richmond will turn on committee calendars and cross-chamber negotiations. HB 161’s ascent puts pressure on senators who only days ago had to salvage their own vehicle. The official trackers for HB 161 and SB 118 will show whether leaders reconcile tax rates, launch timelines and oversight structures in time. If they do, Virginia could move from study to statute and set a July 2027 go-live under the Senate plan, or sooner if the House model prevails. If they do not, the issue will likely return next session with a fuller regulatory blueprint — and a bigger number attached to the share of online play the state still does not tax or supervise.