Online gaming and sports betting has been key drivers of casino gaming revenue over the last few years. However, some states want a bigger cut of the profit.
Lawmakers in New Jersey, Maryland, Ohio and Mississippi are trying to raise taxes on certain sectors of their state’s gaming industry.
New Jersey Gov. Phil Murphy recently released a new budget for the 2026 fiscal year, which includes a record $58.1 billion in expenditures. As a result, the budget almost doubled the tax rate on the Garden State’s online casino and sports betting industries.
Murphy wants to bump the rate from from 13% to 25%. Legislators have until June 30 to approve the budget.
Murphy sought to avoid income and sales tax increases while also introducing taxes on many other activities. Murphy included go-cart racing, laser tag, bowling, interior design services, horse training and vehicle trade-ins in the tax increase, but there are countless others as well.
Online gaming tax increases are a part of that package as well, but the plan overall may see some pushback in the state house and senate.
“The process is just beginning,” State Sen. John Burzichelli told NJ.com. “There’s not an appetite in my mind — I can’t speak for everyone — for new taxes. There’s just enough stress around everything that new taxes are hard to sell to anybody.”
Other States Get In On the Tax-Raising Act
Some other states are also considering raising taxes on online gaming and sports betting. In Maryland, Gov. Wes Moore’s new budget includes a boost to the state’s online sports betting tax rate.
Moore wants to double the tax rate from 15% to 30% in the hopes of helping to shore up a $3 billion budget shortfall. Traditional casino gaming would also be affected, with the tax on table game revenue rising from 20% to 25%.
Mississippi lawmakers want to raise taxes on the casino industry. The desire comes after online sports betting legislation failed to pass the senate.
The House Ways and Means Committee passed a tax increase on the state’s casino industry from 12% to 16%. Legislators believe the increase would raise as much as $50 million a year for state coffers.
Lastly, Ohio Gov. Mike DeWine wants to double the tax rate on the Buckeye State’s sports betting industry.
His plan would increase the operators’ tax rate from 20% of gross receipts to 40%. Moreover, his proposal comes after the state already raised the rate from 10% to 20% in 2023.
The new increase is part of DeWine’s proposed $218 billion budget for 2026 and 2027, which would also increase taxes on tobacco and marijuana.
“These sports gaming [groups] are extremely aggressive… they’re in your face all the time,” DeWine told the Ohio Capital Journal. “They’re getting Ohioans to lose massive amounts of money every year and it seems to me only just and fair that some of the stadiums be paid for by them or a portion of it.”