Online Sports Betting Tax Increases in Maryland
Let's Talk Sports Betting Tax Bump in Maryland φ photo by Northern-Virginia-Photographer, CC0, via Wikimedia Commons
The Scoop
Listen up, sports fans! The tax rate for online sportsbooks in Maryland is getting a bump, raising from 15% to 20%. This ain't no small potatoes, peeps.
The man behind it all? Governor Wes Moore, who initially had his eyes set on a 30% tax rate, but after some chin-wagging with legislators, they agreed on a 20% increase.
Why The Bump?
You might be wondering, "Why the heck is the tax going up?" Well, here are a few reasons:
- Budget Gap: Maryland's got a hefty budget deficit, sitting at around $2.7 billion. The tax hike is part of a larger strategy to chip away at that mammoth number.
- Neighborhood Comparison: Maryland's taxes are lining up with neighboring states like Illinois and Ohio, which similarly tax online sports betting at 20%.
- New White House: With a new White House possibly impacting Maryland's economy, it's a smart move to boost their funds.
Where's the Money Going?
95% of the tax revenue will go straight to Maryland schools, with the other 5% supporting various state operations through the general fund. Since December 2021, over $160 million in tax revenue has been channeled towards education, so it's no secret that this industry is vital to our schools' future.
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[1] Budget Reconciliation and Financing Act of 2025[2] Governor Moore Signs Budget Reconciliation and Financing Act of 2025[3] Online Sports Betting Tax Increases in Maryland[4] New White House's Potential Impact on Maryland's Economy[5] Maryland's Budget Deficit Exceeds $2.7 Billion
- The increase in Maryland's sports betting tax rate from 15% to 20% might also encourage more online casino activity, as the tax rate for sports betting becomes similar to that of neighboring states like Illinois and Ohio.
- Governor Wes Moore's original proposal for a 30% tax rate on sports betting was reduced to a 20% increase, which could indicate a compromise made during discussions with legislators.
- In light of a possible impact from the new White House on Maryland's economy, the decision to raise the tax rate on sports betting could be seen as a financial move to secure additional funds for the state.
