The Mississippi House approved a bill that would legalize online sports betting after it was amended to include a higher tax rate.
Rep. Casey Eure (R-Saucier) proposed the bill on Tuesday, a few weeks after his initial submission that failed to gain much traction.
Key Takeaways
- A previous version of the legalization bill only included a 4-8% sliding tax.
- Lawmakers believe they could generate $100 million in new annual tax funding.
- Mississippi passed massive tax cuts just last year.
The Mississippi House voted 100-11 in favor of Eure’s Mississippi Mobile Sports Wagering Act (House Bill 4074) on Wednesday, just one day after it was introduced. That was the bill’s second successful vote, following a triumph in the Ways and Means Committee.
Under the new terms of the bill, the state would impose a 22% tax rate on all approved sportsbooks, provided sports betting is eventually legalized. Eure claimed that standard was on par with the national average and would generate about $100 million in annual tax revenue for the state.
The earlier version of the bill (HB 1581) was only projected to generate about $80 million in annual gaming taxes based on a 4-8% sliding scale.
HB 4074, just like the older version, would allocate $50 million annually from its sports betting tax revenue to the Public Employees Retirement System.
“By legalising mobile sports betting, we can eliminate much of the illegal market – including protecting underage bettors – and provide real consumer safeguards in a regulated environment,” Eure said.
“This legislation will also give our brick-and-mortar casinos a new revenue stream to ensure their continued success, while the state revenue generated will help close the gap in funding for our Public Employees’ Retirement System.”
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How will the casino industry react?
Mississippi sports betting was launched in-person on Aug. 1, 2018. However, it still has yet to legalize online sports wagering, despite being one of the earliest adopters of sports betting in any form.
While Eure’s bill would help establish a framework for online wagering, it would also reshape the state’s casino industry. Brick-and-mortar properties would enjoy a 2% tax cut, dropping from 8% to 6%.
The tax cut is a concession to casino owners, who have consistently opposed online sports betting legalization in previous legislative sessions. It would also replace a $6 million fund to help smaller casinos survive cannibalization caused by online expansion. Estimates suggest that casinos would save about $48 million annually with the tax cut.
While support for the bill is growing, it is not unanimous. Sen. David Blount (D-Hinds County), chairman of the Senate Gaming Commission, said that mobile sports betting does not align with the state’s vision for its gambling industry.
“The reason we have gaming in Mississippi is to encourage investment, to create jobs and to grow tourism to bring other people from other places to Mississippi,” Blount told Mississippi Media last year. “Mobile sports betting doesn’t do that.”
Finding new ways to generate funding
Mississippi lawmakers passed the largest total tax cut in state history last year, which included an elimination of state income tax and a reduction in grocery sales tax. Legalizing online sports betting would allow the state to recoup more tax funding without having to walk back the changes it instituted just last year.
As of 2024, Mississippi had the lowest nominal GDP per capita of any state in the U.S., according to the U.S. Bureau of Economic Analysis. The next-lowest state, Arkansas, was still 13.6% above Mississippi.
