The North Carolina House of Representatives isn’t going along with a proposed sports betting tax hike on operators.
Key Takeaways
- Without the tax increase, North Carolina House’s state budget proposal doesn’t allocate as much funding for the university system.
- The two sides have until July to iron out their differences.
- The Sports Betting Alliance also opposes a 100% increase in sports betting tax on operators.
The Senate’s two-year, $65-billion state budget, approved in April, calls for a doubling of the tax on sportsbooks from 18% to 36%. The House’s recently released $66 billion two-year proposal keeps North Carolina’s current tax rate, which has generated nearly $144 million for the state since online sports betting went live in March 2024.
The two sides of the assembly have until July 1 to negotiate their budget proposal differences before passing full approval. If the sports betting tax rate is raised, it would go into effect on Oct. 1.
North Carolina has generated more than $7.8 billion in wagers from March 2024 through this April. The state’s operators – FanDuel, DraftKings, BetMGM, Caesars, ESPN BET, Underdog, Fanatics Sportsbook, and bet365 – have produced nearly $800 million in gross revenue since online wagering began.
Differing dollars
The state’s two biggest public universities, North Carolina and NC State, currently receive no funding from sports betting tax revenue. Thirteen other colleges in the system do get money from wagering. With the suggested tax hike, the Senate proposes handing out more than $55 million over two years to UNC and NC State and creating a tiered system with lesser payouts for the other schools.
Without the increased tax revenue, the House’s plan allocates $26.3 million during that span for all of the Tar Heel State’s FBS schools, App State, East Carolina, and Charlotte.
Other opposition
The Senate is facing more than just pushback from the House on a North Carolina sports betting tax hike. The Sports Betting Alliance, made up of operators BetMGM, FanDuel, DraftKings, and Fanatics Sportsbook, began a public campaign opposing the 100% rate increase.
“Sports betting tax revenue already generates millions each year for North Carolina. But a 100% increase? That could drive players to the illegal market, putting those funds – and consumer protections – at risk,” the SBA wrote in a petition to Tar Heel State residents.
North Carolina has yet to introduce retail sports betting or pari-mutuel wagering, which would generate more tax revenue for the Tar Heel State once those forms of gaming launch.
