Online sports betting operators are dealing with a new tax rate in Maryland.
Gov. Wes Moore signed into law the Budget Reconciliation and Financing Act of 2025, filed as House Bill 352. The measure includes a tax increase for sports betting operators. HB 352 raised the state’s tax rate on sports wagering from 15% to 20%.
Moore approved Maryland’s new tax rate for online sports betting following an arduous legislative process during which lawmakers pushed back against his initial proposal. In an early draft of HB 352, Moore proposed doubling the tax rate for online sports betting from 15% to 30% to help alleviate a $2.7 billion state budget gap. He also proposed raising the state’s table game tax rate from 20% to 25%. Moore’s initial proposal didn’t garner enough support despite his argument that a 30% tax rate mirrors rates in neighboring states.
He also argued that the increase to 30% was “sound tax policy” to help the budget gap. Despite Moore’s effort, lawmakers approved an amended version of the budget act with a smaller tax increase.
The House Ways and Means Committee voted 13-5 to approve an amended version of HB 352 to set the tax rate for operators at 20%, down from Moore’s initial 30% proposal.
Under HB 352, proceeds from sports betting are allocated toward Maryland’s General Fund, which receives 5% of tax revenue. The remaining 95% is used to support public education.
Moore’s state budget did not include a provision to authorize online casinos putting an end to the possibility of passing an iGaming measure. Maryland lawmakers, including Sen. Ron Watson and Del. Vanessa Atterbeary, proposed measures to authorize iGaming. Both bills, Senate Bill 340 and House Bill 17, never crossed over from their original chamber.
Maryland adds to tax rate changes
Ohio, which doubled its tax rate on sports betting from 10% to 20% in 2023, is considering another hike after Gov. Mike DeWine presented a budget plan that considers a rate up to 40%. A senator in Ohio is also aiming to increase profits from wagering by taxing handle in addition to revenue.
Last week, Sen. Louis Blessing filed Senate Bill 199 as a measure that would add a 2% tax on total wager dollar amounts to the state’s existing 20% tax rate. Under SB 199, the handle tax also applies to the adjusted gaming revenue generated by retail sportsbooks.
Louisiana is considering a tax increase to benefit athletic departments at public universities across the state. The measure, House Bill 639, was passed by the House on Tuesday by a 73-15 vote. The bill will now head to the Senate for further consideration.
The success of HB 639 depends on another measure as the House Appropriations Committee tied the piece of legislation to a bill that also proposes a tax change.
It is tied to House Bill 594, which establishes a flat tax rate on insurance premiums.
New Jersey may also see operators taxed at a different rate after Gov. Phil Murphy released a budget that raises the state’s tax rate on sports betting and iGaming to 25%.
The Garden State currently levies a 13% tax rate on sports betting with iGaming at 15%.
Illinois has already implemented a new tax rate by introducing a sliding scale model that sees operators taxed at 20% or 40% depending on their adjusted gross revenue.
