The situation in the North Carolina sports betting landscape is a frustrating one, to say the least. North Carolina lawmakers did not have an issue allowing mobile sports betting in the state in the previous legislative window. What held it up was many small details that some legislators were unwilling to compromise on. It had nothing to do with the idea of sports betting but rather some of the rules and processes around it.
What makes it even more unfortunate is that surrounding states are raking in sports betting tax revenue and helping themselves with yearly budget issues. There are many things other states that have passed sports betting legislation are using funds for. Let’s look at three nearby states, how much revenue they bring in, and what funds are doing to help the state.
How Much Sports Betting Revenue Are NC’s Neighbors Making?
As an online-only betting state, Tennessee makes quite an amount of tax revenue. Tennessee has one of the higher tax rates on sports betting at 20%. The last three months of released betting revenues in Tennessee have averaged about $3.5 million in tax revenue.
- May 2022: $4,766,458
- June 2022: $2,559,649
- July 2022: $3,668,804
In Virginia, sports betting is taxed based on a permit holder’s adjusted gross revenue. Virginia taxes the AGR at a 15% rate. The last three months of released revenue numbers averaged around $4 million in revenue.
- July 2022: $3,060,303.71
- August 2022: $1.4 million
- September 2022: $7,257,403.31
West Virginia, while not the largest state, is doing very well bringing in tax revenue from sports betting handles across the state. Operators are taxed at an 8.5% rate. The Mountain State averaged over $4 million monthly in revenue over the last three months of released data.
- July 2022: $2.617 million
- August 2022: $$4.030 million
- September 2022: $6.97 million
Helping education: NC Lottery Donates $302 million to local schools
What Nearby States are using Tax Betting Revenue for
The revenue from sports betting in Tennessee is split into three funds:
- 80% to Tennessee Education Lottery’s Lottery for Education
The money is used to help fund scholarships and grants for students statewide.
- 15% to local governments for use on roads and other infrastructure projects.
- 5% to the Tennessee Department of Mental Health and Substance Abuse.
The Commonwealth of Virginia is not specific about how the revenue is used. 97.5% of tax revenue is deposited in the state’s general fund. The remaining 2.5% is deposited into the Problem Gambling Treatment and Support Fund. It is convenient for Virginia, though, as money being put into the general fund means it can be used however the state needs it to be.
West Virginia spreads its taxes around more than most states giving many different state organizations a piece of sports betting tax revenue.
- Lottery Commission 30%
- Racing Purses 7%
- Host Counties 2%
- Racetrack Employee Pension 1%
- West Virginia Thoroughbred Development Fund* 1.5%
- West Virginia Racing Commission 1%
- Returned to Licensee 46.5%
- Tourism Fund 3%
- Workers Compensation Debt Reduction Fund 7%
- Other 1%
Get in the game: Gambling options near North Carolina
What North Carolina Sports Betting Could Make
Depending on the tax rate, North Carolina could see millions a month in tax revenue. What it could be used for is up for debate, but surely it could help the state that has oftentimes struggled to pass budgets have more tax money to go around.
AP Photo/Brynn Anderson