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Senate Votes Down MA Sports Betting Tax Proposal

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As several markets consider industry tax increases, a proposal to hike the MA sports betting tax rate was defeated Thursday.

During Massachusetts Senate budget discussions, Sen. John Keenan proposed an amendment to more than double the MA sports betting tax rate. The amendment, OTH 828, was filed Wednesday.

The Senate rejected the amendment as it works to finish the FY 2025 budget. 

MA sports betting tax stays put

Kennan’s proposal raised the Massachusetts sports betting tax to 51% from 20%. That would put the state in line with the NY sports betting tax rate.

Earlier this year, Massachusetts collected more than $108 million in sports betting taxes during its first year. That was nearly double the tax revenue lawmakers projected as they legalized the industry.

That came from $542 million in taxable sports betting revenue. 

Other states consider tax increases

Shortly after launching sports betting last year, Ohio Gov. DeWine signed a sports betting tax increase, bumping it to 20% from 10%.

New Jersey Sen. John McKeon introduced a sports betting tax hike bill in April. McKeon aims to raise the online casino and sports betting tax rate to 30% from 15% and 13%, respectively.

Illinois Gov. JB Pritzker included a sports betting tax increase to 35% from 15%. Pritzker also proposed raising taxes on businesses to help fill in spending gaps.

“I wish we had big surpluses to work with this year to take on every one of the very real challenges we face,” Pritzker said in February. “It’s important to note that while this budget is tight this year, our fiscal house is in order, and we are able to keep our commitments to the people of Illinois.”

Sportsbooks fighting against taxes

Following the Illinois budget proposal, FanDuel urged customers to help sway lawmakers to vote no. 

This month, the Sports Betting Alliance came out against Pritzker’s proposal. The group, which includes BetMGM, DraftKings, Fanatics and FanDuel, said tens of thousands of emails have been sent.

“SBA companies entered in Illinois with the understanding they would be operating under a 15% tax rate. All of them are currently operating in the red, but are still investing in the state based off long-term potential under a 15% tax rate,” SBA spokesperson Nathan Click told LSR earlier this month.

“Doubling the tax rate massively, that changes the calculus — and basically makes these investments exceedingly harder to recoup — much less turn a profit. The state taxes promos, so operators’ effective tax rate is actually between 30%-60%.” 

The post Senate Votes Down MA Sports Betting Tax Proposal appeared first on Legal Sports Report.

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