By Tyler Wombles
As sports betting revs up in Maryland, with retail betting now live and online gambling soon to come, it’s fair to wonder how much tax revenue the industry will bring to the state.
A widespread number for Maryland sports betting revenue isn’t yet available, as the market just launched in the state in January, but there are several clues that can show how well the community may benefit financially from sports betting’s entrance into the state.
Here’s a look at how much tax revenue we could see from Maryland sports betting in the first year:
Over $38 million in tax revenue is possible
Those expecting Maryland to see tax revenue in the dozens of millions could be in luck.
There’s a chance Maryland could see over $30 million in tax revenue just from mobile betting, which would be a big boost for the local economy. Combining that with the money retail betting should bring in proves key to unlocking the overall tax revenue puzzle.
Online sports betting hasn’t yet launched in Maryland, but it will make a splash when it does. In other states, mobile betting has comprised a large majority of bettors’ activity and thus has led to the majority of the revenue.
Online sports betting could bring as much as $217 million in annual revenue, per projections by Maryland Sharp. With the state taxing betting revenue at 15%, that would mean Maryland would earn $32.55 million in tax revenue from online sports betting alone.
Add in retail betting and the grand total of annual sports betting revenue is expected to be $255 million, per the projections. Altogether, with the projections of mobile and retail betting combined and everything being taxed at 15%, the state could bring in over $38 million in tax revenue.
Keep in mind, though, that with the uncertainties that come with setting up an entire retail sports betting industry, then turning around and doing the same for the online market, the numbers could vary or be lower than any projection.
It’s easy to see why mobile betting could take Maryland by storm. It’s done so in numerous other states that have successfully legalized and launched sports betting. Since the online component allows bettors to put money down wherever they are, instead of having to travel to a physical sportsbook location, it’s a massive part of the sports betting market anywhere.
In New York, which instituted mobile sports betting in early January, mobile betting brought in over $3.5 billion in wagers in just two months, according to Politico. While Maryland isn’t nearly the size of New York and thus will see smaller numbers, the Empire State’s huge turnout proves how much bettors will flock to mobile gambling if given the chance.
Other states’ numbers could give clues
For more clues on how much tax revenue Maryland betting could bring in, other states could be the key.
New York saw $70 million just in tax revenue in its first month of operation, The New York Post reported. While Maryland wouldn’t see that much money simply because of the differing sizes of the two states, it’s fair to assume it would see a big turnout for mobile betting as New York, which celebrated the momentous revenue numbers.
“Over the past month, we’ve seen how mobile sports wagering can be an economic engine for New York, driving significant funding to our schools, youth sports, and so much more,” Gov. Kathy Hochul said, according to The New York Post. “As this new industry continues to grow, New York will make sure we have the resources and guidelines in place to make it a success for all.”
Tax revenue estimates are even available for states that haven’t yet legalized or launched sports betting.
In Missouri, sports betting tax revenue could come out to over $15 million, according to the St. Louis Post-Dispatch, which cited a recent legislative analysis. It’s another state in which some lawmakers and supporters are pushing for the additional revenue sports betting could bring to local governments.
“Every year that Missouri is waiting is another day that consumers are left unprotected and money is left on the table,” iDevelopment and Economic Association Executive Director John Pappas said, according to The St. Louis Post-Dispatch. “It just doesn’t make sense to be on an island when literally every state surrounding them is going to have legal sports betting.”
Just as betting handles and profit have come in droves for states that have legalized and instituted sports betting, tax revenue has proven to go along the same line. There’s no reason that shouldn’t be true, too, for Maryland, which could pocket a significant amount of tax revenue money as retail betting continues to grow and mobile betting finally goes live.