Massachusetts Senate Officially Rejects a Proposal to Significantly Increase the Tax Rate on Sports Betting Operators

May 28, 2024 | Tax

BOOSTON, MA (May 27, 2024) — The Massachusetts Senate has officially rejected a proposal to significantly increase the tax rate on sports betting operators. Senator John F. Keenan (D) had introduced a plan to raise the tax from 20% to 51% in the 2025 budget, aligning the state with New York’s highest rate in the country. The proposal aimed to boost revenue for various state funds and ensure that sportsbooks contribute a fair share to public finances.

Despite the potential revenue benefits, the proposal was quickly dismissed by the Senate within two days. Opponents argued that such a steep increase could harm the legal sports betting market by reducing overall revenue, as operators might struggle to sustain their business under the higher tax burden.

The decision comes amid a broader national debate about increasing taxes on online sports betting operators, driven by the industry’s unexpectedly high revenues in many states. However, for now, Massachusetts will maintain its current 20% tax rate for at least another fiscal year.

The timing of the proposal was notable, occurring shortly after online sports betting operators failed to attend a roundtable discussion with the Massachusetts Gaming Commission (MGC). The commission had sought to address concerns about operators limiting customers, particularly those winning consistently. The operators’ absence was justified by the need to protect trade secrets, though it drew criticism for the lack of transparency.

Commissioner Jordan Maynard emphasized the importance of public transparency and integrity within the industry, underscoring that the commission’s operations are mandated to be open to public scrutiny, despite the discomfort it may sometimes cause for stakeholders.


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