Betting News 
Key Takeaways
- Pennsylvania leads in casino tax revenue, collecting $2.3 billion in 2024.
- States like Nebraska and Virginia see dramatic increases in tax revenue from newly approved commercial casinos.
- New York tops sports betting tax revenue with over $2 billion.
Tax Revenue from Casinos
Recent data from the American Gaming Association (AGA) highlights the substantial tax revenue generated by commercial casinos across the United States. In 2023, Pennsylvania emerged as the top state for casino tax revenue, collecting a remarkable $2.3 billion. This was closely followed by New York with $2.1 billion and Nevada with $1.2 billion.
States that have recently introduced commercial casino gaming, such as Nebraska and Virginia, have experienced significant growth in tax revenue. Nebraska saw a staggering 535% increase, while Virginia‘s tax revenue surged by 161% between 2022 and 2023.
Tax Revenue from Sports Betting
Sports betting has also become a major contributor to state tax revenues. According to Legal Sports Report, New York leads the pack, collecting over $2 billion in sports betting taxes. Pennsylvania follows with $615 million, and New Jersey with $541 million.
In terms of sports betting handle, New Jersey tops the list with over $51 billion in bets, followed by New York at $45 billion and Nevada at $41 billion.
Professional handicapper Raphael Esparza notes that the future growth of sports betting in newly legalized states is uncertain. He emphasizes the need for bookmakers to innovate to retain customers, suggesting that offering a wider range of betting options, such as presidential odds or entertainment bets, could drive growth.
Spending in Casinos
Customer spending in casinos also shows impressive growth. In 2023, Nebraska and Virginia recorded the highest increases in customer spending, with growth rates of 535% and 98%, respectively. Nationwide, casino customer spending grew by over 10%, reaching $66.7 billion, which translates to $14.7 billion in taxes.
Nevada remains the leader in total customer spending, with $15.5 billion spent in its casinos. This accounts for nearly one-quarter of all casino spending in the U.S. Pennsylvania and New Jersey follow with $5.9 billion and $5.8 billion, respectively.
Future Outlook and Recommendations
For sports bettors, Esparza offers some cautionary advice: “Parlay bets paid my salary working in the Vegas books, so that is my number one not to do,” he warns. He advises bettors to “Play smartly and get the number you want. If that number is not there, then pass or watch ‘live’ betting numbers.”
Looking ahead, the expansion of legalized sports betting across the U.S. appears to be slowing. Esparza points out that no new states passed sports betting legislation in the 2024 legislative season. Missouri might be the next state to legalize sports betting, but residents of California, Texas, and Georgia may have to wait longer.
The data underscores the significant role that commercial casinos and sports betting play in generating state tax revenue. Pennsylvania, New York, and Nevada are leaders in total tax revenue from casinos. Additionally, sports betting has emerged as a major revenue source, with New York, Pennsylvania, and New Jersey leading in tax collections and betting handle. As more states consider legalizing commercial casinos and sports betting, the trend of increasing tax revenue and customer spending is likely to continue, benefiting state economies and providing valuable insights for policymakers.
However, as Esparza’s comments suggest, the future of the industry may depend on innovation in betting products and careful navigation of legislative hurdles. States and betting operators will need to balance the potential for revenue growth with responsible gambling practices and evolving consumer preferences.
Methodology
This study utilizes data from the American Gaming Association (AGA) and Legal Sports Report to analyze tax revenue and growth in the commercial casino and sports betting industries. The AGA provides comprehensive data on casino operations, including tax revenue, customer spending, and year-over-year growth. Legal Sports Report offers detailed insights into sports betting tax revenue and betting handle. The data was collected and analyzed to identify trends and significant changes in the industry. The focus was on states with the highest tax revenue and those with notable growth due to recent approvals of commercial casino gaming and sports betting.
