Sports Betting Tax Income Rises by 35% in 2023, Approaching $2.5 Billion
Last year, the 38 US states and the District of Columbia where sports betting is legal and operational reaped significant tax benefits. According to a report by LendingTree, a personal financial website, state taxes from sports betting and parimutuel wagering totaled $2.479 billion in 2023, representing a 34.7% increase from 2022 when the state tax benefit stood at around $1.84 billion.
"Sports betting has become a massive industry in the United States, with platforms like DraftKings and FanDuel dominating advertising during sporting events," LendingTree said in a statement. "This growth not only means more money for the states where it's legal but also contributes to the overall economy."
A total of 38 states and Washington, DC currently have legal sports gambling, either in person, online, or both, while five additional states are considering legalizing it in 2024.
Leading the Pack: New York
Out of these states, New York holds the leading position in terms of betting activity and tax generation. The state's online sports betting industry kicked off in January 2022, resulting in some impressive tax figures. In 2023, New York collected $876 million in taxes from its sports betting revenue. With the highest population among commercial sports betting states, New York outshines California and Texas, which have yet to legalize sports betting. New York also imposes a 51% tax on sportsbooks.
Coming in second is Pennsylvania, with a 36% tax rate on sportsbook operators. It collected $176.6 million in sports betting taxes. Next is Indiana, which generated $175.4 million, followed by Illinois with $161.4 million and Ohio with $136.3 million. The Garden State of New Jersey, which initiated the legal challenge that made its way to the US Supreme Court in 2018, raked in $111 million.
In addition to the state tax receipts, the federal government also collects an excise tax of 0.25% on every wager made.
Public Opinion on Sports Betting
LendingTree also conducted a poll of over 2,000 US adults aged 18 to 78 to gather their views on sports gambling. 44% of respondents support nationwide legalization of sports betting, while only 18% are opposed. However, 47% of those polled expressed concern about the potential increase in cheating and match-fixing due to the growing popularity of legal sports betting.
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Source: www.casino.org
