New VA Sports Betting Law Limiting Promos Boosts Revenue

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VA sports betting

Virginia sports betting is bringing in much more for the state this football season than last year with new rules about promo deductions in place.

Operators held 9.7% on a record $528 million in October handle for $51.2 million in revenue for VA sportsbooks. The new rule limiting promo deductions from taxable revenue to the first 12 months after an operator launches helped tax revenue hit $7 million for the month.

That is the second-highest tax payment since the market launched in January 2021. College football and NFL betting returning in September led to $7.3 million in taxes.

Swing in sports betting promo deductions

Only five operators were eligible to deduct promotional dollars from taxable revenue this October. That is compared to all nine live operators last year.

That means just less than $1 million in promos were deducted compared to a heftier $15.8 million deducted last year. With sports betting revenue taxed at 15%, the state lost out on nearly $2.4 million in tax dollars in October 2021.

Operators are not as heavy-handed with promos these days, as many are focused on profitability, so there is no guarantee Virginia would have seen the same amount of deductions this year.

Arizona sportsbooks are also facing their second full football season. There, operators deducted $24.5 million in free bets on $55.2 million in revenue in September.

Virginia books facing new competition

For the first time since VA sports betting launched in 2021, the market has real competition.

It is well-documented that DC sports betting is far from perfect. DC Councilmember Elissa Silverman submitted legislation for a new sports betting model after hearing how DC residents are traveling to Virginia to place their bets. Silverman lost her November election, though.

Mobile sports betting in Maryland is finally live, though, after retail sportsbooks launched in late 2021. Bettors seem to love the state’s offering so far with 16.5 million transactions in five days. That only trailed New Jersey in the same period.