As Tennessee lawmakers deliberate legislation to upend the sports betting tax structure, the state’s Sports Wagering Advisory Council has revealed that revenue amongst operators has almost doubled in the last year.
In the SWAC’s latest revenue report encompassing March 2023, it was disclosed that handle in Tennessee, driven by March Madness bets, reached $392.7m last month, up 6.1% year-over-year. It is also 20% above the $327.3m wagered in February, when aside from the Super Bowl, there was little live sport.
Operators enjoyed a strong hold rate of 11.1% in March, allowing revenue to climb by 92.1% YoY, with sports betting turnover in Tennessee reaching $43.7m last month.
Meanwhile, with a similarly strong hold rate of 11.5% last month, the revenue growth was less profound but did increase by 37.2% in just one month.
The Tennessee SWAC does not reveal any information about individual operator’s revenue figures, nor does it break down handle by sport.
Currently, there is a 20% tax rate imposed on operators’ GGR, meaning that sports betting generated $8.8m for the state in March 2023, up 92.6% compared to the $4.5m yielded in March 2022.
However, as aforementioned, lawmakers are currently deliberating whether to change the tax structure from 20% of GGR to 2% of handle.
SB475 passed the Senate last week and has now begun its journey through the House and if passed, would make Tennessee the only state in the US to tax handle rather than revenue.
If the proposed changes were implemented, lawmakers estimate that the state will benefit to the tune of $7.36m.
However, if operators were taxed 2% of the $392.7m in wagers they processed in March, they would have paid just $7.9m in tax for the month, down 10.3% on the actual tax intake.
