Ohio Tax Rate Going Down?
When Ohio lawmakers legalized digital sports betting in December 2021, they did so with a 10 percent tax rate. Betting didn’t go live until Jan. 1, 2023, and within six months of that launch, Gov. Mike DeWine pushed through a doubling of the tax rate to 20 percent. But if the Senator who authored the legal sports betting bill in the first place has his way, that rate will go back down.
Sen. Niraj Antani introduced SB 190, a two-page bill that would return the tax rate to 10 percent. The bill was in the Senate Finance Committee and in written testimony Nov. 12, Antani suggested that his goal would be for the state to have one of the lowest tax rates in the nation – 6.75 percent, but that going back to 10 percent would be “reasonable.”
“The 20 percent rate makes us the 6th highest out of the 38 states with sports betting. The lowest in the country are Iowa and Nevada, three times lower than our rate,” Antani wrote. “Our border states, Kentucky, Michigan, Indiana and West Virginia, now all have significantly lower tax rates. This puts us at a significant regional and national disadvantage.”
In general, operators prefer a rate at or below 10 percent, saying that legal betting is a low-margin business and that they can offer better odds and more products with lower taxes, or costs. Of the legal betting states plus the District of Columbia, 10 currently have tax rates that are 10 percent or below, seven have rates between 10.1-15 percent, five have rates between 15.1 percent-20 percent, and five have rates over 20.1 percent. Betting is not taxed in some states, like New Mexico or Wisconsin, where the tribes are offering only on-site gambling and don’t have to pay taxes to the state.
Antani also has another gambling bill under consideration. His SB 312 would legalize iGaming. That bill is also in the finance committee, but has not gained any traction. The Ohio special session opened Nov. 13 and is set to close Dec. 19.
PASPA Champion Ted Olson Dies
Ted Olson, the lawyer who represented the state of New Jersey in Murphy v. National Collegiate Athletic Association before the U.S. Supreme Court, died Nov. 13. Olson was the winner in the case, which overturned the Professional and Amateur Sports Protection Act (PASPA) and made legal sports betting a states rights’ issue.
Olson, 84, was a solicitor general in the George W. Bush administration, and he argued a litany of high-profile cases from same-sex marriage to Bush vs. Gore in 2000. In total, he argued more than 65 cases before the Supreme Court.
Gibson Dunn, the law firm in which Olson was a partner, announced his death Nov. 13.
“Ted was a titan of the legal profession and one of the most extraordinary and eloquent advocates of our time,” said Barbara Becker, chair and managing partner of Gibson Dunn, said in a press release. “He was creative, principled, and fearless – a trailblazing advocate who cared about all people. We mourn his loss profoundly and send our condolences to his wife Lady, a cherished member of our firm family, and to all of Ted’s loved ones.”
NFL Betting Drove Flutter in Q3
Flutter executives Nov. 12 said that “peak wagers per minute” for the 2024 NFL season are already higher than they were for the Super Bowl, and that was a key driver of what they called an “excellent” third quarter, reports iGB. The company beat market expectations, but still had a $114 million loss for the quarter. In reporting its earnings, Flutter slightly increased its EBITDA projections by 1 percent.
The company began a projected $5 billion stock buyback program Nov. 14.
CEO Peter Jackson pointed to projected launches in Brazil, Missouri and Ontario, Canada in 2025 as positives as the company looks forward. He also said that the acquisition of Diamond Sports Network and early testing of the company’s new “Your Way Parlay” bode well for future revenue and customer acquisition. Outside of the U.S., revenue and sentiment are also strong, as Jackson said the Sisal integration and recent acquisition of Snai in Italy and continued growth of the SportsBet product in Australia as drivers in those markets. In addition, he pointed to a bigger range of online gambling products in the UKI as plusses.
October Handle Strong in NY, North Carolina, Tennessee
New York bettors made October 2024 the best month in the history of legal betting for the state, laying down $2.32 billion in bets, per iGB Nov. 8. That number is up 14.9 percent against October 2023 and 15.4 percent against September. Despite the high handle, bettors won more than operators and hold dropped to 7.6 percent, a more than two-point drop against September. Due to the low hold, gross gaming and tax revenue were down against September.
Eight months into offering legal sports betting, operators in North Carolina took $600 million or more in bets for the third time in October. The North Carolina revenue report was released Nov. 12. Bettors wagered $612 million in the Tar Heel State, but operator hold dropped from more than 12 percent in September to 8 percent in October, meaning revenue dropped month-over-month.
In Tennessee, operators set a new record for handle and tax revenue. The Tennessee Sports Wagering Council releases only limited numbers for sports betting, but showed that operators took more than $500 million in bets for the third time since launch in Nov. 2020. The latest report was released Nov. 12.
In Other News …
DraftKings opened a new $500 million revolving credit line, per a Nov. 8 Sportico report. The credit line will allow the company liquidity and should save it money, as the interest rate is lower and terms different. A consortium led by Morgan Stanley is extending the credit line.
Connecticut residents late last week filed a lawsuit against sweepstakes company Chumba, per CDC Gaming Reports. In the class-action lawsuit filed in state court, consumers claim they were defrauded by the company.
The Massachusetts Gaming Commission (MGC) Nov. 13 announced that it has created an official seal for legal wagering operators in the state. The commission will require that operators display the seal on platforms beginning this month, according to an MGC press release.
BetMGM extended its partnership with the Las Vegas Golden Knights, it shared in a Nov. 14 press release. The new deal, which will include fan experiences, co-branded content and promotions, is in effect through the 2026-27 season.
