With the launch of Massachusetts sports betting Friday, the state’s professional sports teams already sealed partnerships to get in on a piece of the action.
These sponsorships can generate significant revenue by featuring sports betting brands in their arenas and on social media.
Regulators gave deals close look
State regulators briefly considered a ban on these deals amid concerns over the average age of attending sports fans, but ultimately allowed them.
Boston-based DraftKings also has an agreements with the Boston Celtics, though they center exclusively around daily fantasy sports. The Celtics have yet to announce a sports betting partner.
MA sports betting tax revenue
Massachusetts Treasurer Deb Goldberg recently told WCVB-TV in Boston she anticipates $35 million to $50 million in tax revenue from the first year of sports betting. But the state could be on pace for even more.
According to LSR projections, total gaming revenue could climb to as much as $550 million in its first year.
More than 84% of sports betting revenue comes from online channels in jurisdictions where both online and in-person betting are legal, according to the American Gaming Association. This means that most of Massachusetts’ 20% online tax should apply, which could equate to roughly $60 million in annual taxes.
How sportsbook money will break down
The revenue from these taxes will be distributed as follows:
- 45% to the General Fund
- 27.5% to local governments (Gaming Local Aid Fund)
- 17.5% to jobs training programs (Workforce Investment Trust Fund)
- 9% to Problem Gambling (Public Health Trust Fund)
- 1% to school tuition (Youth Development and Achievement Fund)
Six sports betting apps launched March 10, with a few more expected in later month. That also could give another big boost to state tax revenue.