Colorado Sees Massive Bump for Sports Betting Tax Revenue in April

The Centennial State’s sports betting market is still going strong five years in.

The Colorado Division of Gaming (CDG) has reported $3.4 million in tax revenue from sports betting in April. The impressive number represents an increase of approximately 53% from the previous month and a 78% increase year-over-year.

The majority of that tax revenue came from basketball betting. The hometown Denver Nuggets’ push into the playoffs led to fans backing their teams with their favorite sportsbooks.

Baseball betting also had a busy month, with over $82 million in wagers placed during the MLB’s opening month. 

The state’s success in April comes at an important time. The state has been looking to increase tax revenue to support water projects, which aim to protect and support freshwater resources.

Lawmakers are currently considering the idea of taxing promotional bets, which sportsbooks can currently write off. This would boost tax revenue without needing to raise its 10% rate for operators.

Colorado Thrives With Low Tax Rate

As states across the country push to raise their tax rate for sports betting operators, Colorado has held its own at 10%. Some changes have been made to help increase tax revenue, which operators have agreed to in order to avoid a larger hike. As a result, the market has had no trouble attracting operators into its competitive market.

The Centennial State’s success is something sportsbook operators have pointed to when fighting tax increases in other markets. The argument is that sportsbooks will offer fewer promotions and worse odds to compensate for the revenue lost from those increases, ultimately hurting the market for bettors.

The state’s numbers demonstrate that it is possible to increase tax revenue from the industry without raising taxes.