February 25, 2024

Ohio State Senator Niraj Antani has proposed new legislation to reduce the tax imposed on sports betting operators in the state. The tax rate was initially set at 10% when sports betting was first launched on January 1, 2023, but it was doubled to 20% in the summer by state lawmakers through the state budget.

The decision to increase the tax rate was supported by Governor Mike DeWine, who cited multiple regulatory actions taken against sports betting operators as the reason for the higher taxes. This included fines levied at BetMGM, Caesars, and DraftKings for alleged violations of state regulations related to responsible gambling messaging. DraftKings was also fined an additional $350,000 for emailing promotions to people under the age of 21, while Barstool was fined for promoting sports betting registrations at a college event.

Senator Antani’s Bill 190 challenges the state’s decision to change the tax rate and proposes to return it to the original rate of 10%. He expressed concerns about the potential negative impact of the increased tax rate on the emerging market, including less favorable odds for bettors, fewer promotions and incentives for customers, and the possibility of sports betting operators exiting the state due to lower profit margins.

Despite these changes, since the launch of sports betting in January, Ohioans have wagered over $5.2 billion on sports, with September being the third-highest single-month handle since the beginning of the year. The state has collected over $89.5 million in taxes since January.

Senator Antani’s proposed legislation aims to address the impact of the increased tax rate on sports betting operators and the market as a whole. As the industry continues to evolve in Ohio, the outcome of the new legislation will be closely monitored to assess its potential effects on the growing sports betting market in the state.