The Massachusetts Senate has voted down a proposal to increase the tax rate on sports betting. The amendment, proposed by Senator John Keegan, aimed to raise the tax rate from 20% to 51%. This would have made Massachusetts one of the states with the highest sports betting tax rates in the country.
Details of the Proposed Amendment
Senator Keegan’s amendment sought to more than double the current tax rate on online sports betting. The proposal was introduced as part of the state’s 2025 budget bill. Keegan argued that the increase was necessary to address societal issues caused by mobile betting. He emphasized the need for more responsible gambling measures and protections.
Senate’s Reaction to the Proposal
The Senate’s reaction to the proposal was swift and unanimous. The amendment was quickly rejected after its introduction. Keegan’s arguments, which included criticisms of deceptive sports betting advertising and calls for a blanket ban on all prop bets and in-game betting, did not sway his colleagues. The rejection of the amendment means that the tax rate on sports betting in Massachusetts will remain at 20%.
Potential Impact of the Amendment
Had the amendment passed, it could have drastically changed the sports betting landscape in Massachusetts. The higher tax rate could have led to fewer sports betting promotions and higher barriers to entry for new operators. This is similar to what has been observed in New York, which has a 51% tax rate on sports betting. The amendment’s failure means that Massachusetts will continue to have a more competitive tax rate compared to some other states.
Comparison with Other States
Massachusetts is not the only state considering changes to its sports betting tax rate. Illinois recently passed a budget that includes a significant increase in sports betting taxes. The new tax structure in Illinois introduces a sliding scale tax from 20% to 40%, depending on the operator’s adjusted gross revenue. Other states, such as New Jersey and Ohio, have also seen recent increases in their sports betting tax rates.
Revenue Implications
In its first year of legalized online sports betting, Massachusetts generated $135.7 million in tax revenues. If the proposed 51% tax rate had been implemented, the revenue could have exceeded $346.12 million for the year. Keegan argued that operators should pay their fair share, given their financial success. However, the Senate’s decision to reject the amendment means that the current tax rate will remain in place.
Criticism of Sports Betting Operators
During the discussion, Keegan criticized licensed sports betting operators for not attending a recent roundtable by the Massachusetts Gaming Commission. The roundtable was meant to discuss customer-limiting practices. Keegan also criticized the heavy advertising campaigns by sports betting operators, which he claimed target young and at-risk populations. He called for a complete prohibition on prop bets and in-game sports betting, citing integrity issues and the addictive nature of in-game bets.
Senate Vote Outcome
The Senate’s vote on the amendment was unanimous. After Keegan spoke for about 25 minutes, his colleagues voted down the proposal. The decision means that the tax rate on sports betting in Massachusetts will remain at 20%, at least for the foreseeable future.
Future of Sports Betting in Massachusetts
The rejection of the tax increase proposal leaves the future of sports betting in Massachusetts relatively stable. The current tax rate allows for a competitive market, which could attract more operators and promotions. However, the debate over responsible gambling measures and the impact of sports betting on society is likely to continue.
In conclusion, the Massachusetts Senate’s decision to vote down the sports betting tax increase proposal means that the tax rate will remain at 20%. The proposal’s rejection highlights the ongoing debate over the balance between generating revenue and addressing societal issues related to sports betting.
