Dollar's Down, House Wins: An In-depth Look at US Sports Betting Taxes
U.S. Sports Betting Analysis in 2024: Colorado Residents Proved to be Astute Wagerers
States across the US are raking in the dough from legal sports betting, with Americans wagering a whopping $150 billion through legal sportsbooks in 2024. Vermont and North Carolina joined the roster, setting the stage for an exciting betting landscape.
Each state takes a distinct approach to sports betting, with astronomical taxes in some regions and single-digit rates in others. Here's a breakdown of the standout performers and some intriguing trends that surfaced in 2024.
On the Money: Breaking Down the Numbers
Junk bond trader Alfonso Straffon teased out some captivating figures, putting together a table showcasing 2024 sports betting outcomes from states that publicly report results. Absent are big players like Florida, where the Seminole Tribe, not obligated to report handle and revenue from Hard Rock Bet publicly, operates.
By scrutinizing this data, a few noticeable patterns began to emerge that are worth a mention.
Betting by Region and Per Capita
While New York reigns supreme in terms of handle, with almost $23 billion in 2024, residents of New Jersey place more bets per capita, shelling out $1,835 per adult in 2024 compared to $1,526 in New York. Surprisingly, North Carolina, despite being the sixth-most populous state with legal sportsbooks, saw only $672 in expenditure per adult in 2024. Given that the sector launched there just in March 2024, some time is needed for it to mature.
Winners and Losers: Adrenaline Rush vs. the House Advantage
If you're curious about how states compare when it comes to sharp bettors, you might be taken aback. Coloradans emerged victorious in 2024, with sportsbooks posting a mere 7.7% retention rate. Iowa followed closely with a 7.9% hold. At the other end of the spectrum, Louisiana earned the wooden spoon for its sportsbooks, boasting a 12.5% hold rate. These statistics serve as a faint reminder that in the long run, the house usually wins.
Among the inferior-performing bettors by state, Louisiana takes the cake (or the wooden spoon, rather), with a sky-high 12.5% hold rate. Retail operations in Nebraska trailed closely with a 12.2% rate, while Washington, D.C. ranked third with a comparatively reasonable 11.6%.
A Stronger Bite from the Apple: Examining High-Tax States
One of the main factors driving the proliferation of sports betting legalization in almost 40 states is the resulting tax income. New York alone reaped over $1 billion in taxes from gross gaming revenue in 2024. The Empire State's 51% effective rate seems unaffected by the robust market size.
Many states consider hiking their taxes, as they see the 51% rate in New York as feasible. Illinois, for instance, upped its taxes to $29.50 per adult. A similar approach could be adopted in Ohio and Maryland to milk as much revenue as possible from operators.
However, bettors fear this trend may drive certain sportsbooks out of markets as taxes escalate or force them to offer less-attractive odds to maintain profit margins.
- The surge in US sports betting in 2024 reached an astounding $150bn, with Vermont and North Carolina joining the fold.
- Each state shapes its own approach to sports betting, showcasing varying tax rates.
- New York stands tall as the state with the highest sports betting handle at nearly $23bn in 2024.
- New Jersey, on the other hand, flaunts a higher bet-per-capita rate, at $1,835 per adult compared to New York's $1,526.
- North Carolina, a newcomer to the sports betting scene, saw $672 in expenditure per adult in 2024.
- Colorado leads the pack for sharp bettors with a 7.7% retention rate for sportsbooks in 2024, followed closely by Iowa at 7.9%.
- Louisiana's sportsbooks reported the highest hold rate of 12.5% in 2024.
- Nebraska's retail operations trail closely, with a 12.2% hold rate, while Washington, D.C. claims a 11.6% rate.
- New York collected over $1bn in taxes from gross gaming revenue in 2024, maintaining a 51% effective tax rate.
- Illinois increased taxes to $29.50 per adult, following New York's lead in boosting revenue.
- Operators fear that escalating taxes may drive some sportsbooks out of markets or force them to offer less-attractive odds.
- Data and cloud computing have emerged as essential tools for effective sports betting operators.
- Technology plays a significant role in shaping modern betting trends, from mobile apps to AI-powered analysis.
- Personal finance and investing have become intertwined with sports betting as people look to diversify their portfolios.
- Books on sports betting strategies and personal growth are popular items in the education and self-development category.
- Celebrities and personalities from the casino and gambling niche often lend their names and fame to various entertainment endeavors.
- Movies and TV shows focusing on gambling trends, big wins, and casino culture have gained traction in pop culture.
- Sports betting has given rise to new career opportunities in fields such as sports analysis, sports-betting data analysis, and sports-betting content creation.
- Sports such as football, baseball, hockey, golf, basketball, racing, and tennis all represent popular sports betting markets.
- As sports betting continues to grow, responsible gambling initiatives have become an integral part of the industry.
- Social media platforms serve as platforms for gamblers to share tips, discuss strategies, and exchange predictions.
- The NASDAQ reached an all-time high in 2024, with many new junk bond traders exploring the sports betting landscape.
- Some states have introduced sports betting laws aimed at strengthening their public finances and supporting local businesses.
- The gambling industry is closely connected to the travel and hospitality sectors, with many destinations promoting their gaming facilities.
- Sports betting has come to intersect with other aspects of life, from food-and-drink events in casinos to lifestyle magazines featuring gambling-related content.
