North Carolina debate grows over sports betting tax increase
A proposal to raise North Carolina's sports betting tax rate has reignited debate over the role of gambling revenues, with supporters arguing the sector should be taxed more heavily while operators warn higher rates could drive players towards unregulated markets.
North Carolina lawmakers are considering increasing the state’s tax on online sports betting operators as part of ongoing budget discussions, with proposals reportedly including a doubling of the current 18 per cent tax rate.
The debate has intensified following commentary from political analyst Andrew Dunn, who argued that sports betting should be taxed at significantly higher levels, citing jurisdictions such as New York where operators face a 51 per cent tax rate.
North Carolina launched legal online sports betting in March 2024 and has since generated substantial tax revenues. Supporters of a higher rate argue that gambling should be treated differently from industries that states typically seek to encourage through lower taxation, such as employment, investment and business growth.
Industry representatives have pushed back against proposals for an increase. The Sports Betting Alliance has launched an advertising campaign in the state urging lawmakers to maintain the current rate, warning that excessive taxation could make regulated operators less competitive and encourage consumers to use illegal betting platforms.
However, advocates of higher taxes point to states including New York, Rhode Island, New Hampshire and Oregon, where tax rates exceed 50 per cent while regulated sports betting markets continue to operate successfully.
The discussion also extends to how additional gambling tax revenues should be used. Some commentators have argued that any increase should be directed towards one-off investments such as infrastructure projects or debt reduction rather than becoming a recurring source of state budget funding.
The issue is expected to remain a key topic as North Carolina legislators continue negotiations over the state’s budget and future gambling policy.
