Tennessee sportsbooks took $341.8 million in bets in December, down from the previous two months. Operators held 7.2 percent or $24.6 million in sports betting revenue, but taxable revenue dropped to $16.5 million after deductions. As a result, the state received $3.3 million in tax revenue.
However, the December report means Tennessee will receive more in tax dollars from the state’s sportsbooks. Specifically, $2.7 billion was bet in 2021 and $198.5 million was reported in taxable revenue. That equals a 7.3 percent hold, far below the 10 percent mandatory minimum statewide sports betting operators are required to hold under the only such rule in the U.S.
Tennessee has nine live sportsbooks, including the recently launched peer-to-peer platform Wagr. But the four that were live as of January 1, 2021 are the only ones under review for now, including: Action 24/7, BetMGM, DraftKings Sportsbook and FanDuel Sportsbook. But the rules have changed regarding minimum hold and instead of facing a $25,000 fine and formal violation, operators can choose to pay the difference in taxes between their actual taxable hold and the 10 percent to avoid a violation. BetMGM, DraftKings, FanDuel are expected to pay the difference to avoid conflicts.
Sportsbooks previously sought to have the minimum hold eliminated entirely, due to concerns over a violation and its potential effect on licensing in other U.S. sports betting jurisdictions.
