Massachusetts Online Sports Betting Tax Rate Will Remain at 20%

• The Massachusetts online sports betting tax rate will remain at 20%
• Sen. John F. Keenan (D-Norfolk/Plymouth) proposed raising the state online sports betting tax rate to 51%
• His amendment was unanimously rejected by the Senate

The Massachusetts online sports betting tax rate will remain at 20% following a Senate discussion this afternoon on the state budget.

Sen. John F. Keenan (D-Norfolk/Plymouth) proposed an amendment to the Senate’s FY 2025 Massachusetts budget to increase the state’s online sports betting tax rate from 20% to 51%, a 155% increase, to put the commonwealth in line with the most taxed sports betting states in the country.

His amendment was roundly rejected by his Senate colleagues.

Operators Should Pay Fair Share

The first year of online sports betting in Massachusetts, from March 2023 to April 2024, accounted for $135.7 million in tax revenues, Keenan said. At a 51% rate, the commonwealth could have brought in more than $346.12 million for the year.

It’s a fair share for operators to pay as they’ve experienced far more financial success in Massachusetts than they originally estimated, he said.

“If we do not act now, there will be no going back with this industry,” he said.

A 51% tax rate would have put Massachusetts in line with New York, the highest sports betting taxed state in the country.

Keenan also criticized the licensed sports betting operators in the state for skipping out on a recent roundtable from the Massachusetts Gaming Commission to discuss the practice of limiting customers. They were invited to the table to discuss their practices but declined, nothing they would have had to divulge proprietary and trade secrets by discussing the practice in an open forum.

The tax increase amendment was unanimously voted down after Keenan spoke for about 25 minutes.

Prohibit Other Types of Sports Betting

Keenan touched on several other topics during his discussion of the tax amendment, warning his colleagues on the dangers of letting the Massachusetts lottery expand online, the possibility of iGaming being legalized in the state, and sports betting operators inundating at-risk populations with heavy advertising tactics.

Sports betting operators target young and at-risk populations with their advertising campaigns, either on television or online, and through aggressive marketing elsewhere throughout the state. Keenan, however, incorrectly claimed that operators lure customers in with terms such as “risk free” or “no sweat” when describing their offers. The Massachusetts Gaming Commission prohibited the use of such language in gaming advertisements

He called for a complete prohibition on prop bets in the state, citing integrity issues in professional sports, and also requested that in-game sports betting be disallowed in Massachusetts as well.

“Those in-game bets have been described to me by someone who had a real addiction to gambling, a true addiction, that it is the crack cocaine of sports betting,” he said.