New Jersey looks set to raise its taxes on online casinos and sports betting with lawmakers reportedly agreeing to a new rate of just under 20% in the state’s proposed budget.
Governor Phil Murphy had originally put forward a 25% rate, but Sports Betting Dime reports that discussions have led to a rate of 19.75% being agreed upon. The new rate is believed to apply to both iGaming and sports betting. The new state budget must be submitted by June 30.
The state currently taxes iGaming operators at 15% and sportsbooks at 13%. Last year, the state collected around $500 million in taxes, with New Jersey online casinos generating a record $2.39 billion and sportsbooks generating just over $1 billion.
New Jersey Lawmakers Agree To Raise Taxes On Gambling CompaniesReduced Increase Favored By Atlantic City And Sportsbooks
New Jersey Lawmakers Agree To Raise Taxes On Gambling Companies New Jersey Lawmakers Agree To Raise Taxes On Gambling CompaniesGiannantonio also believes the tax increase will lead to more bettors turning to unregulated platforms, he states, “Further, as evidenced in other jurisdictions, this type of tax hike will not yield such expected tax dollars to the State Treasury because it will result in diminishing returns through a consumer shift away from the licensed and regulated providers and back to the unregulated and illegal, offshore online businesses from which the state derives no revenue.”
New Jersey Lawmakers Agree To Raise Taxes On Gambling Companies opposed plans to increase taxes. Jeremy Kudon, president of the Sports Betting Alliance (SBA), commented, “This tax increase would be a wrong turn for New Jersey. Since New Jersey first launched regulated sports betting seven years ago, sports betting operators have created thousands of jobs and generated hundreds of millions in revenue for New Jersey. New Jersey Lawmakers Agree To Raise Taxes On Gambling CompaniesNew Jersey Targeting Unregulated Markets
New Jersey Lawmakers Agree To Raise Taxes On Gambling Companies generated almost $1 billion in revenue in New Jersey last year. Additionally, unregulated casinos reportedly generated $1.5 billion in revenue. New Jersey has been making several moves to reduce the size of the unregulated market. New Jersey Lawmakers Agree To Raise Taxes On Gambling CompaniesAdditionally, the state is currently in a legal battle against sports prediction markets site Kalshi. The decision in the New Jersey case could be instrumental for the future of the markets, which are not regulated at the state level. Over 60 tribes, as well as 34 states, filed briefs supporting the New Jersey Division of Gaming Enforcement’s (NJDGE) case against Kalshi.
The actions of the NJDGE will hope to offset any fears of users turning to unregulated markets after a tax increase.
Adam is an experienced writer with years of experience in the gambling industry. He has worked as a content writer and editor for five years on sites such as Oddschecker, CoinTelegraph and Gambling Industry News, bringing excellent knowledge of the world of sports betting and online gambling. Adam focuses on emerging stories in the ever changing landscape of betting in the US. Read the latest on prediction markets, changing legislation, and sweepstakes.
