March Madness gave Tennessee two favored matchups in Round 1. While only one advanced, the state saw a significant uptick in legal sports betting handle
A reported $392.6 million in wagers were taken in last month, a 20% spike from February’s $327.3 million. After paying out winners and other adjustments, the state’s retail and online sports betting sites saw $45.5 million in gross revenue a 43% monthly increase.
March #SportsBetting numbers ????for #Tennessee via SWAC. Rankings out of 29 months in parentheses.— Chris Altruda (@AlTruda73) April 18, 2023
Handle: $392,667,304 (5)
GGR: $45,506,700 (4)
GGR WR: 11.59% (3)
AGR: $433,734,787 (3)
AGR WR: 11.14% (3)
Year over year, March’s 2023 handle was 6% higher than 2022 while gross revenue was an impressive 71% higher.
Thanks to an 11.5% hold by the operators, the Volunteer State saw a generous tax bill last month. Sportsbooks paid an additional $2.3 million to the state, a total of $8.7 million.
“Hold” on a minute
Tennessee’s sports betting law is unique in two aspects: One is it forces sportsbooks to hit a 10% hold every year and are fined if they do not. The other is sportsbooks must use league data for live wagers.
Recently, Tennessee sports betting laws will look to drop both requirements after operators pushed back on the unfairness. A 10% hold is possible but unlikely and a $25,000 fee seems like an easy out for sportsbooks who don’t want to offer unfair lines to chase a 10% hold. After deferring any fines last month, the legislature is offering to scrap the rule entirely.
The same goes for the official data requirement, which would also be removed in the new senate bill after SuperBook and Betly complained about the high price they were being charged to obtain the necessary data rights.
More changes ahead
Just because the state legislature is trying to remove two unpopular provisions doesn’t mean the sportsbooks are getting off easy. It may be the opposite. The same senate bill will include a tax on handle, not on revenue like the other legal betting states.
While the tax would be just 2%, it would give the state a huge revenue bump, estimating it would be an additional $7.3 million per year.