Potential Revenue Growth Spurs State iGaming Legalization Discussions

• Increased revenues remain one of the main drivers of iGaming for states considering legalization
• Three state legislators today discussed iGaming legalization efforts with the iDevelopment & Economic Associaton
• Increased protections through a regulated market for an activity that is already ongoing is another key point for legalization

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The promise of increased revenue growth – and further protections for consumers – is driving iGaming legalization discussions being held in states considering the form of gaming.

Virginia Sen. Jeremy S. McPike (D-29), Ohio Rep. Brian Stewart (R-12), and Massachusetts Rep. David K. Muradian, Jr. (R-9) participated in an iDevelopment & Economic Association (iDEA) roundtable this afternoon. Moderated by John Pappas, state advocacy director for iDEA, the legislators discussed the ongoing efforts to legalize iGaming and ensure the new form of gaming can coincide with other gaming facets in their respective states.

“Legislatures are just now starting to think about their priorities in 2027, and I believe iGaming will be part of the discussion in several states,” Pappas said.

Promise of Increased Revenues Can Lead Legalization

It is no secret residents of Massachusetts are participating in iGaming right now, Muradian said, through either offshore means or unregulated platforms. It is a simple premise, he said, and the state must determine if it wishes to allow residents to continue participating in an unregulated black iGaming market or regulate the games and benefit from tax revenues.

It was the progression the state saw with sports betting legalization, he noted, and the Massachusetts Gaming Commission has ensured the commonwealth now has one of the safest and well-regulated sports betting markets throughout the entire country.

“iGaming seems to me to be the next logical step in progression. We want to provide a proper and save avenue for people to participate,” he said.

One the few Republicans in the Massachusetts legislature, Muradian said a recent ballot initiative to reduce the state’s income tax from 5% to 4% failed, but iGaming had been considered to be part of a solution to bridge the shortfall of revenue if the initiative had passed.

If passed, the commonwealth would have experienced a $4 billion shortfall in revenue, he said, and iGaming revenues would have been included in the solution to bridge that gap.

Stewart noted many legislator in Ohio are open to the idea of iGaming legalization primarily through the standpoint of increased revenues. Ohio includes many conservative lawmakers who don’t gamble and think others shouldn’t as well, but also support the elimination of the state’s income tax.

Ohio iGaming studies have shown upwards of $400 million a year in tax revenues at full market maturity, he said.

“People are warming up to the idea that if there are individuals that want to participate in this activity, you can tax it at a fairly aggressive rate. That’s an awful lot of money we can use to eliminate our income tax,” he said.

Cannibalization Concerns Do Exist

McPike noted in Virginia’s brick-and-mortar casino industry there are concerns regarding cannibalization of revenues if iGaming is approved.

“Certainly there are concerns around cannibalization. At some point we’re going to saturate some of the cumulative gaming market,” he said.

It’s difficult to accurately project and forecast iGaming revenues, McPike said, and is more than prudent to be conservative in estimates when considering iGaming legalization. It’s tough to accurately consider iGaming revenues until it actually “shakes out in Virginia.”

Pappas pointed to the fact that New Jersey brick-and-mortar casinos reported record-breaking revenues in 2025 and are on-pace to top those numbers in 2026. New Jersey was one of the original states to legalize iGaming and revenues continue to increase every single year.