North Carolina Increases Sports Betting Tax To 23% Under New Bill

North Carolina has increased the tax on sports betting operators after Governor Josh Stein signed Senate Bill 257 into law on 7 July, approving a new state budget raising the tax rate from 18% to 23%.

The change comes just over two years after online sports betting launched across the state. Licensed operators will keep offering mobile wagering under the framework regulated by the North Carolina State Lottery Commission, but the revised budget means the state will now retain a larger share of operator revenue.

Since statewide mobile betting went live in March 2024, North Carolina’s regulated market has exceeded many early expectations. The state has generated over $300 million in tax revenue, improving lawmakers’ confidence and providing the financial data for reassessing the original tax structure.

Higher tax revenue will support public spending priorities

The Major Events, Games, and Attractions Fund will now be capped at $30 million each year, allowing more proceeds to flow into the General Fund. Additional funding will also support public education and state sports programmes.

Revenue from the regulated market has consistently been promoted as a funding source for college athletics, youth sports initiatives and gambling addiction services. The revised formula expands those funding priorities while giving the state greater flexibility to support its wider budget.

North Carolina follows the trend of increased betting taxes

Although operators will face higher costs, North Carolina’s new tax rates are below the highest levels seen elsewhere in the United States. New York imposes a 51% tax on mobile sportsbook revenue, while Illinois has adopted a more expensive model with higher tax rates and per wager charges.

North Carolina has instead opted for a middle ground, treating sports betting as a new industry needing lighter taxation. But the state has also avoided imposing the highest tax rates nationwide.

Across the US, more states are reviewing tax structures introduced during legalisation as regulated markets mature. Neither DraftKings nor FanDuel responded to requests for comment on the increase before publication.

North Carolina is the latest state to adopt higher tax rates with the newly passed bill increasing it to 23%. This will boost the percentage received from operator revenue and fund development projects like gambling addiction services and college athletics.