NY Sports Betting Sets Tax Revenue Bar

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NY sports betting

The Empire State continues to break its own records for tax revenue from online NY sports betting. 

For the third consecutive month, New York set a US record with $75.6 million in November online New York sports betting tax revenue. 

Previously, New York posted nationwide highs in September ($73.1 million) and October ($74.2 million.) 

The massive tax revenue numbers will make it difficult for operators and lobbyists looking to reduce NY’s 51% tax rate on online sports betting

Surprise: books do not like NY tax rate

While operators willingly accepted the 51% tax rate when they were granted licenses in the state, they have continued to complain about it since. 

Executives from FanDuel Sportsbook, DraftKings Sportsbook, BetMGM and Caesars Sportsbook all publicly voiced displeasure. Through November, those four operators make up 93% of NY’s market share and 95% of its revenue share. 

Efforts at a tax reduction via operator expansion failed last legislative session, but are expected to continue. 

“Somebody’s going to have to make that realistic, fiscal economic argument that by doing that — reducing the 51%, increasing the amount of operators — benefits the people of New York State and increases the money for education,” Sen. Joe Addabbo told LSR

“If it’s a credible argument, then we go forward. If not, we move on.” 

NY sports betting revenue strong

From Jan. 8-Dec. 11, NY amassed a US record $655.3 million in online sports betting tax revenue. 

During the week of Dec. 5-11, NY surpassed the $15 billion mark in online sports betting handle, and currently sits at a US-high $15.2 billion from Jan. 8-Dec. 11, including $1.3 billion in total gross gaming revenue.

For the 2023 fiscal year (April 1, 2022-March 31, 2023), NY hit $457.2 million in tax revenue (April-November) thus far. It is on pace to beat Gov. Kathy Hochul’s projection of $615 million from her enacted budget. 

“New York is the most successful state in mobile sports betting in the country,” Addabbo said. 

New York sports betting talks next

With NY set to hit the one-year mark since Jan. 8 launch, discussions will center on whether any adjustments and enhancements should be made to the state’s existing online sports betting product. 

Addabbo and Assemblyman Gary Pretlow both say they want to revisit the possibility of offering more betting markets. Betting on individual player future awards is currently prohibited. 

What could change?

Allowing New Yorkers to wager on awards like the MVP, Cy Young and Heisman would keep them from betting in other states and with unregulated offshore sportsbooks that have those offerings. 

NY legislators could also look at revisiting in-stadium kiosks and fixed-odds horse racing.  Also on the table is potentially looking at allowing for promotional deductions

“On the cusp of going into the budgetary discussion for next year, it makes for an interesting topic,” Addabbo said, “Whether we look at mobile sports betting intensely or whether we just gaze at it, let it go and move onto iGaming and downstate (casino) licenses.” 

FanDuel keeps leading way

NY followed up a $1.54 billion October with a $1.55 billion November in terms of online sports betting handle. 

As has been the norm, FanDuel led in November market share ( $646.2 million, 42%) and revenue share ($78.3 million, 53%.) 

DraftKings was second in both categories, followed by Caesars and BetMGM.