New York’s new sports betting regulations were designed to make it the most competitive market in the Northeast. But a new bill could cost mobile sportsbooks and land-based operators new customers by prohibiting online gaming firms from participating at lower tax rates than their brick-and-mortar counterparts.
On Monday, New York Gov. Kathy Hochul’s administration disclosed that bettors wagered approximately $150 million in legal sports wagers on Jan. 1, the first day new state-regulated online gambling sites were allowed to take bets.
Those figures are staggering, providing longtime state Assemblyman J. Gary Pretlow with optimism that the Empire State will become the nation’s most robust market for online sports wagering .
New York’s new sports betting market is off to a hot start. The Empire State Gaming Commission reported $196.2 million in handle on bets placed at New York’s six new legal, commercial casinos and nine racetracks during the month of May, according to figures released by the commission earlier this month.
The state collected $12.4 million in revenue from the new tax rate matrix, which charges 25% on any bet handle above $5 million (for both casino and racetrack wagering).
That sizzling start suggests that New York may exceed $10 billion in handle in 2022, a benchmark only one state, New Jersey, reached last year. If the handle approaches $12-$15 billion.
Whether New York will be a nationwide leader in tax policy for mobile sports wagering remains to be seen. But one thing is certain: Pretlow isn’t aware of any other jurisdiction with such an idea, which would bar gambling companies from even asking their state about modifying tax rates on betting sites.
Pretlow, an expert in the field and open-market advocate understands operators’ concerns about attaining profitability given current tax environment. Last July he predicted that four industry heavyweights – FanDuel, DraftKings, BetMGM & BallyBet would team up for their own super bid since expenses were too high without working together to maximize profits as each company had been doing individually before now; this proved correct when all five companies formed one massive partnership only last month.