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While Maryland sports bettors wagered less money in May, the state saw its highest tax revenue payout since the industry’s launch in November 2022. The number was an unexpected but welcome surprise for the state. While this is an impressive feat, a few factors explain why this happens.
According to Maryland’s sports betting laws, online sportsbooks must give the state 15% of their winnings. This number is determined after all winning bets have been paid out. The remaining funds are taxed at 15%, which was $4.6 million in May. That is an impressive 20% increase, especially considering the drop in overall money being bet.
While the increased payout for the state is great, Seth Elkin of the Maryland Lottery and Gaming Control Agency doesn’t believe this trend will necessarily continue. “That’s always gonna vary. ” Elkin said of the May tax numbers, “There's no firm way of predicting it.”
While several factors contributed to the 20% increase, the NBA Finals and NHL Stanley Cup Final were some of the biggest. Both featured eight seeds that have advanced all the way to the championship round. Their stunning postseason runs have led to more losing bets and more winnings for online sportsbooks. This is especially true of the NHL, where the Boston Bruins were a heavy favorite to win the Stanley Cup but were dispatched by the Florida Panthers in the first round.
While the increase is being celebrated, there are doubts this success will carry over into June.
Both championship series will wrap up over the next week, meaning this boost will unlikely last through June. That will leave baseball as the only major sports league to have games until September. Baseball betting and other smaller summer sports do not draw as many bets, meaning sportsbooks usually see a sharp decrease in revenue. That signals that June could see a significant tax revenue drop for not only Maryland but the country as a whole.
However, Maryland is also set to add a tenth online sportsbook this month. Fanatics Sportsbook opened registration on June 1 and is expected to launch this month. That will mean lucrative welcome bonuses and promotions that could draw more bettors, despite the lack of pro sports to bet on. While this won’t lead to another significant increase in tax revenue, it should help cover some of the losses that the end of the NBA and NHL season bring.
Michael is an avid sports fan and a veteran bettor from Milwaukee. He learned the trade from his grandfather in Las Vegas as a kid and has turned that into a successful career. He cheers for all Wisconsin pro teams along with his Alma Mater Arizona State. He specializes in baseball betting, but has experience in football, basketball, and hockey as well. When he isn’t pouring over stats, he’s spending time with his two young children.More info on Michael Savio
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