North Carolina Lawmakers Consider Raising Sports Betting Tax Rate Above 18%

(AsiaGameHub) –   As budget negotiations proceed in Raleigh, North Carolina legislators are once more examining sports betting taxes, with the 18% rate established at the market’s launch in March 2024 now potentially subject to adjustment for online sportsbooks.

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Good to Know

• The state may increase the tax on sportsbooks from 18% to a range of 20% to 30%.
• Discussions have also included implementing a tax per bet placed, akin to the system in Illinois.
• Through the Sports Betting Alliance, FanDuel has urged its customers to resist the proposal.

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Raleigh Looks Again At Sportsbook Revenue

Since its introduction, online sports wagering has provided North Carolina with over $287 million in additional revenue. Legislators are now contemplating requiring more from the operators.

Per a WRAL report, sources indicate state lawmakers are weighing a tax increase on the eight licensed sports betting operators. One proposal would raise the rate from 18% to between 20% and 30%. An alternative would impose a fee on every individual wager.

The ongoing budget discussions lend greater significance to the debate. Following a recent Republican agreement to boost state employee pay, legislators are exploring revenue options for the upcoming state budget. A potential tax increase on lottery sales has also been mentioned as a method to support higher salaries for teachers and state workers.

Backing for the proposed gaming tax changes is uncertain. WRAL noted that it is unclear if lawmakers support the suggested hikes.

A significantly higher sportsbook tax was already considered in North Carolina last year. The Senate’s budget plan featured a 36% rate, which the House did not endorse. With both chambers unable to agree, the rate remained at 18% for 2025 and 2026.

The per-wager concept could provoke a more forceful response from operators. Illinois pioneered this model in the U.S. last summer. Its surcharge imposes 25 cents on each of the first 20 million bets and 50 cents per bet thereafter. In just the initial two months of 2026, this fee generated an additional $20 million for Illinois.

Major betting firms, however, contested the Illinois tax. Some operators shifted the expense to customers via betting surcharges or increased minimum bet requirements. Industry organizations have cautioned that such extra costs might drive bettors to offshore or illicit betting platforms.

FanDuel has already begun mobilizing its North Carolina customer base. The operator emailed customers late last week, cautioning that “some lawmakers in Raleigh want a brand new tax hike on N.C. fans.”

FanDuel further stated “if we don’t stop them, bettors like you will pay the price” and that “your gameday gets more expensive every time you open the app.”

The Sports Betting Alliance, whose members include FanDuel, DraftKings, bet365, BetMGM, and Fanatics, is against alterations to North Carolina’s sports betting tax structure. FanDuel has encouraged customers to “take action” by submitting a letter via the alliance’s website.

“Legal sports betting is generating real revenue for collegiate athletic departments across the state,” the letter says. “A tax hike would threaten that funding and hit fans like me directly.”