U.S. Sports Betting Hits $10 Billion Milestone; States Take $1.5 Billion
Billie Weiss/Boston Red Sox/Getty Images. Pictured: An American flag at Fenway Park.
It only took four years for U.S. sports betting to hit the $10 billion revenue mark, and thanks to New York, it got there ahead of schedule.
The milestone became official Tuesday, as revenue reports from Michigan and Pennsylvania rolled in. Since the U.S. Supreme Court overturned the federal ban on sports wagering outside of Nevada, operators have generated $10.004 billion in revenue, providing $1.5 billion in taxes to states.
As of today’s reports, Americans have legally bet a total of $141 billion across more than 30 states, with sportsbooks keeping about 7% of every dollar bet.
Six Months of New York Betting Accelerated Growth
The rate at which national revenue has increased rapidly sped up in January — when New York launched its online betting market.
Since then, the Empire State has beaten each state every month in handle. New Yorkers have bet $8.59 billion in their first six months of online betting. That’s more than Illinois — the state with the third-most bets this year — and Nevada (fourth-most) combined.
It also far surpassed everyone else in taxes, thanks to a hefty 51% tax rate and not allowing sportsbooks to deduct promotions. Over 20% of all sports betting tax revenue to the states comes from New York.
It's unlikely national sportsbooks like FanDuel and Caesars would be willing to weather that tax burden anywhere else, though. New York's by far the most populous state with legal sports betting, and thanks to a mechanism in its gaming law, the tax rate drops if more operators join.
Ohio is set to launch legal online and retail sports betting in January, and it will become the fourth-most populous state to do so. Recently legalized states — Kansas, Maine and Nebraska — are on the horizon as well.