A bill before the New York state senate that would reduce online sports betting taxes was rejected by a vote of 43-18 last Thursday. The move leaves in place a tax rate for online gambling at 16%.
According to the current budget recommendations from the New York Assembly and Senate, the number of mobile sports betting companies in New York may expand. Both organizations proposed greater online sports betting skins in their one-house budget recommendations, but no wording concerning a tax rate decrease was included in any of their plans.
The Empire State officially began its mobile sports betting industry in January of this year, with nine providers. Operators have to agree to a 51 percent tax rate on their income in order to participate in the market; however, this proportion has been regarded too costly by certain industry executives, who have demanded additional licenses for the market.
Proposals for Budget
Previous Proposals for Budget saw the suggestion for the decrease of the tax rate, which is the highest for a sports betting market in the whole of the U.S. However, with the last two proposals from the New York State Assembly or the New York State Senate such a language has been omitted. But still, the two plans propose an increase of online sportsbook operators.
Senator Joe Addabbo Jr. and Assemblyman Gary Pretlow are two legislators who want to see additional operators in the state’s mobile sports betting market. Mr. Addabbo recently said that whether it is increasing the number of operators or lowering the tax rate, the reform must be fiscally sound, and that the market is now advantageous to the people of New York.
Meanwhile, the state continues to enjoy the benefits of its online growth, with US$42 million in taxes collected in the first full month of operations, which was February. The operators processed nearly US$1.5 billion in online sports wagers for the whole month, according to the New York State Gaming Commission.
In the state’s newly opened mobile sports betting sector, there are now eight gambling businesses operating. FanDuel, DraftKings, Caesars Sportsbook, BetMGM, BetRivers, WynnBET, PointsBet, and Resorts World are among the companies that have entered the industry thus far. Bally Bet is the only one remaining, but the business just declared that it would take its time and start in April of this year.
The eight active skins have handled US$322,845,031 in wagers in the first six days of March, producing income of US$31,151,027. More than half of it will be used to fund the state budget. FanDuel has handled the most money so far this month, with a total of US$ 130,151,524, DraftKings is second with US$ 83,956,641, and Caesars Entertainment is third with US$ 57,974,688.
Continuation of the Sector’s Expansion
Mr. Addabbo Jr. announced his ambition to develop the Empire State’s gaming industry last month. Senator S8412 was proposed in the New York Senate, and if passed, it would allow interactive gaming in the state. He claimed in his proposal that the expansion would produce around US$475 million in annual state tax income.
Waters, Matthew, “Mobile NY Sports Betting Could Expand Despite Tax Cuts,” LegalSportsReport, March 14, 2022.