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For over three months, New York has benefitted from a legal sports betting market that boasts a multi-billion dollar handle, early success that has kept it at the top of that industry, but an effort to expand has been nipped in the bud for now as a new legislative proposal has been dropped.
New York Assemblyman J. Gary Pretlow’s provision would have used the state’s 2023 budget to gradually expand the number of legal mobile sportsbooks allowed from nine to sixteen, but it was dropped and noticeably missing last Thursday from Governor Kathy Hochul’s budget deal.
As we reported back in January, In Just 12 Hours, New York Became the “Top State for Sports Betting in the US!” and ever since it has continued to generate impressive monthly handles due in part to the high number of pro and college sports teams based in the Empire State.
It would seem to make sense to expand that already successful New York sports betting market, but the reason that idea was dropped might trace back to how it might affect the state’s expected tax revenue.
Once the Supreme Court overturned PASPA in 2018, states have been allowed to legalize, regulate, and tax their own sports betting markets, both online and in person, and every state has chosen a tax rate that they feel will best work for them.
Those rates run as low as 6.75% in Iowa and Nevada, but many prefer a 10-15% rate while a couple charge even higher rates like Pennsylvania’s 36% and Delaware’s 50%, but at the top of them all is New York who charges its sportsbooks 51% of their revenue.
Despite that high rate, New York continues to rake in tax revenue, with some reports showing that number at close to $150 million, a high number until you measure it against the total handle in that same time which was almost $2 billion.
Lawmakers saw Pretlow’s proposal as a threat to that tax revenue stream since as the newer sportsbooks would be added, that tax rate would be decreased to as low as 25% once the number of sportsbooks climbed to fifteen.
Not acceptable, and that could be why legislators failed to include that provision in the latest budget, the idea most likely being that since that market does not seem broken then there is no sense in trying to fix it this early on.
There are billions of dollars at stake here in the New York sports betting market, with ten-figure handles a common sight there since that operation launched in January, money that until those laws were passed was being spent elsewhere outside the state.
Before that launch, New York bettors found ways to put money on the Nicks, the Yankees, Mets and Giants, with offshore sports books and local bookies always an option, though now it has become far easier to go the legal route.
That means that same money is now redirected back homewards, and New Yorkers will benefit from those wagers made, a win-win that over thirty states are now experiencing with that number continuing to grow.
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Mike Lukas is a retired standup comedian turned freelance writer now living in Dallas, Texas, originally from Cleveland, Ohio. His love for the game of football and all things Cleveland Browns turned Mike into a pro blogger years ago. Now Mike enjoys writing about all thirty-two NFL teams, hoping to help football gamblers gain a slight edge in their pursuit of the perfect wager. Email: [email protected]More info on Mike Lukas
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