After little more than a year of legal online sports betting, North Carolina is far outpacing its own projections for how lucrative the market could be.
The North Carolina Lottery Commission published its June 2025 revenue report this week, and in doing so, it completed the state’s first full fiscal year of financial reporting on the state of the digital sports wagering market.
Overall, from July 2024 through June 2025, North Carolinian bettors laid down $6.4 billion in cash wagers. The Tar Heel State’s eight licensed sportsbooks — bet365, BetMGM, Caesars, DraftKings, ESPN Bet, FanDuel, Fanatics and Underdog — earned $647.7 million in FY 2025 gross revenue, and the state’s 18% tax rate yielded $116.6 million in tax revenue.
In June alone, sportsbooks took $420.7 million in handle, up 8.8% from June 2024. Operators’ revenue climbed 44.1% year-over-year to $58.1 million and generated $10.4 million in tax revenues, more than $3 million more than the same month last year.
Since the state opened its doors to commercial online sportsbooks in March 2024, North Carolina has made $166 million in tax money from sports betting.
Aim a little higher
The lottery commission does not break down handle and revenue totals by sportsbook. But what we do know is that the most recent U.S. sports betting market to launch is far ahead of schedule when it comes to revenue generation.
When state lawmakers legalized sports betting in 2023, the fiscal research estimated that the state could make $53 million in sports betting tax revenue for FY 25. It ultimately more than doubled that number. The state didn’t expect to break the $100-million barrier for tax revenue until FY 28, let alone in the first full fiscal year.
The estimates also suggested it would take three full years for the state to hit $6.6 billion in total wagers. Including promotional wagers, North Carolinians wagered that amount in FY 25 alone.
Itchy feet already?
The early success hasn’t stopped (or has perhaps contributed to?) North Carolina lawmakers looking to make early tweaks to the lucrative sports betting market.
Back in January, a group of legislators proposed House Bill 14 that would allow for a state income tax deduction for losses against bettors’ winnings, effective as of the 2024 tax year. Currently, gambling winnings in the state need to be included as income and are taxed at the same 4.5% rate as the rest of residents’ incomes, with losses not deductible.
That bill has not made much progress and currently sits dormant in the Finance Committee. But there’s a chance it comes to the fore now that the issue of gambling tax deductions has turned federal in recent days.
Another bill sought to ban prop bets on college athletes, similar to a measure that was filed last year but failed to gain momentum. It would also limit betting on site at a collegiate sporting event in the eight hours leading up to as well as during the event if it takes place in the state. But H828 has not taken a step since being first referred to committee in April.
The biggest proposed change came later that month, when the state’s Senate budget proposal included a provision to double the sports betting tax rate in the Tar Heel State from 18% to 36%. That rate would have put North Carolina near the top of the rankings of states which charge the highest tax fees on sports betting, behind only New York, New Hampshire, Delaware and the highest rate charged on Illinois‘ sliding scale.
The proposal in North Carolina to double the rate after just a year of the open market led to pushback and the version of the budget that was passed by the House scrapped the idea entirely.
