The most popular sports betting state in America by total handle, it only makes sense that New York would also lead the way in betting tax revenue.
In the third quarter of 2023, New York accounted for nearly 37% of all sports betting tax revenue, raking in over $188 million for the state during this period. This was more than five times the revenue of the second leading state, Indiana, which recorded just under $39 million in tax during the same period.
Massive tourism numbers and iconic sports franchises, along with top betting platforms like BetRivers sportsbook, have all been key factors in New York’s leading position in the US sports betting market.
According to the Quarterly Survey of State and Local Tax Revenue (QTAX), tax from sports betting brought in over $500 million nationally, an increase of 20.5% from Q3 of 2022. Of this national revenue, New York accounted for an astounding 37%.
This is due to a combination of two factors. First, New York on its own is the most popular state for sports betting. As the most populous state with legalized online sports gambling, a thriving tourist industry centered around New York City, and a whole host of iconic franchises including the New York Yankees, New York Knicks, and New York Giants, the Empire State has the perfect storm of qualities to be a sports betting behemoth.
Second, they have the nation’s highest tax rate on sports betting revenue at a whopping 51%. Smartly understanding that the popularity and allure of online wagering will outweigh any tax concerns, New York has profited heavily from this betting tax.
On the second anniversary of mobile sports betting in the state, Governor Kathy Hochul announced that the state had collected $1.55 billion in taxes on sports betting, with most of the money going towards education.
All signs point towards New York raking in even more tax revenue from sports betting in 2024. In January, the state set a record with over $211.5 million in revenue, becoming the only state besides Ohio in January 2023 to record over $200 in revenue in a single month.
And, another industry powerhouse is set to join the fray soon. PENN Entertainment purchased Wynn Interactives betting license in the state earlier this year and plans to launch a collaboration with sports media behemoth ESPN BET later in 2024, adding another popular sportsbook to the mix.
Overall, sports betting in New York has turned into a serious money maker for the state, and the use of this tax revenue on education is a prime example of how sports wagering tax can be used to benefit the masses.
