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A new tax system for online sports betting is being pushed by Assemblywoman Carrie Woerner of New York, who was recently selected as the chair of the Assembly Racing and Wagering Committee. She presented Bill A6013, which would reduce operator tax rates while increasing the number of mobile sportsbooks.
The bill, if passed, would raise the number of regulated sportsbooks in the state from nine to fourteen by 2026 and then to sixteen by 2027. The goal of this change is to provide market accessibility for operators who are now hindered by the high tax burden in New York.
Currently, New York imposes a 51% tax rate on gross gaming revenue, the highest in the U.S. Woerner’s plan would implement a tiered tax system, reducing rates as more operators join the market. If the number of sportsbooks reaches 15 or more, the tax rate would drop to 25%.
Despite its high tax rate, New York remains the nation’s most lucrative sports betting market. In 2024, operators generated $2.05 billion in revenue from a $22.7 billion handle, far outpacing Illinois, which recorded $14 billion in wagers.
Currently, FanDuel, DraftKings, Caesars, BetMGM, Fanatics Sportsbook, BetRivers, ESPN BET, Bally Bet, and Resorts World Bet operate in the state. ESPN BET, launched in September 2024, became the newest entrant after PENN Entertainment acquired WynnBet’s license for $25 million.
If the bill passes, bet365, Hard Rock Bet, Prime Sports, Betr, and Underdog Sports could join the growing market. The lower tax rates would make New York a more attractive option for these brands.
While New York considers lowering taxes, several states are moving in the opposite direction. New Jersey Governor Phil Murphy recently proposed raising the state’s online sports betting tax from 13% to 25%.
Similarly, Ohio plans to double its rate from 20% to 40%, and Illinois Governor JB Pritzker introduced a progressive tax system in 2024, with top-tier operators like FanDuel and DraftKings paying 40%.
Joe Brennen Jr., former Prime Sports executive chair, criticized these hikes: “It’s all being done very wantedly without any real thought to sustainability to the industry. There has to be an effort to go back and make the case to legislators that this is really bad in the long term.”
New York lawmakers will now debate whether Woerner’s bill aligns with the state’s long-term interests. If successful, the plan could reshape the competitive landscape of online sports betting in the U.S.