Sports betting is now legal in 40 states plus the District of Columbia, with states raking in billions in tax revenue since the Supreme Court ruled in 2018 that states could legalize sports betting. In 2024 alone, tax revenue for sports betting in the U.S. reached nearly $3 billion.
Sports betting companies now take in nearly $150 billion in wagers each year, according to SportsHandle.com. What's more, Americans are expected to bet a record $30 billion on the football this season, according to the American Gaming Association. In response, some states have added -- or are considering -- new taxes on sports betting revenue.
In June, Illinois imposed a per bet tax, $0.25 on the first 20 million bets and a $0.50 on wagers after that. In response, FanDuel responded with a $0.50 surcharge on all wagers, and DraftKings (DKNG -0.40%) has signaled it may follow suit. Analysts suggest the new tax could eat into earnings for sports betting companies, but if the Illinois tax proves successful in adding to its coffers, other states may follow suit with their own.
Similar taxes have been under consideration in New Jersey, Maryland, Massachusetts, Michigan, and Pennsylvania.
Read on for a breakdown of sports betting tax revenue by state and where gamblers are wagering the most.
Sports betting tax revenue by state
New York has accumulated the most tax revenue from sports betting, some $3.4 billion since June 2019.
Sportsbooks have also generated the most revenue from gamblers in New York, $6.7 billion since legalization.
New Jersey has the largest disparity between sportsbook revenue and state tax revenue. The Garden State has collected just $674 million off of $5.2 billion in gross sportsbook revenue since June 2018, when sports betting was legalized.
South Dakota has generated the least revenue from sports gambling, just $323,202. That's because sports betting can only occur at eight casinos in the state -- those in Deadwood and at tribal casinos -- significantly limiting opportunities to gamble.
Is it better to bet on sports, invest, or save?
Based on the numbers during football season, the average bettor on football loses between 8% to 9% of what they wager. That translates to a $133 to $209 loss per bettor depending on the year. Even with big games and high stakes, sportsbooks consistently come out ahead, and most individual bettors finish with less than they put in.
By comparison, putting that same money into a high-yield savings accounts or the stock market would have delivered steady gains. High-yield savings accounts offer modest but safe and predictable returns of between 0.4% and 2.7% over the football season, depending on the year, while the S&P 500 delivered anywhere from 1% to 12% gains, again depending on the year.
Football season | Average Bettor Return | Average Bettor Dollar Return | HYSA Return | S&P 500 Return |
|---|---|---|---|---|
2024 Season | -8% | -$209 | 2.7% | 6% |
2023 Season | -9% | -$186 | 2.5% | 12% |
2022 Season | -9% | -$133 | 0.4% | 1% |
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Methodology
Average bettor returns for each football season were calculated using monthly sportsbook data on handle and gross gaming revenue (GGR) win rates from Sportshandle.com. For each season, a weighted average GGR win rate was calculated from September through February, then inverted to show the average bettor ROI as a percentage of wagers. Dollar losses per bettor were calculated by distributing total sportsbook revenue across the estimated population of sports bettors, 15% based on data from SBRnet.
High-yield savings account (HYSA) returns were estimated using peak annual percentage yields for the relevant year, compounded over six months. S&P 500 returns were calculated as the percentage change in the index from September open to the last trading day in February, and reflect price-only returns.
Sources
- Sportshandle.com (2025). “Legal US Sports Betting Revenue, Handle And Tax Totals Since PASPA Repeal.”
- State tax and gaming agencies.
About the Author
Jack Caporal has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
