Football is back and Tennessee unsurprisingly saw a huge spike in legal sports betting, although the handle is not nearly as impressive taxwise.
Tennessee’s Sports Wagering Advisory Council announced that the state accepted $420 million in bets last month, a 72.5% jump compared to August’s $243.4 million. Sportsbooks claimed nearly $2 million in adjustments, which was slightly more than August’s $1.6 million.
Not only that but the Volunteer State saw nearly 25% more in handle compared to this point last year.
New legislation backfiring?
September is another month where the state’s tax bill failed to beat last year’s haul, despite a boost in wagers. Tennessee now bills online betting sites based on their gross wagers as opposed to taking a higher percentage from their net revenue (once they pay out winning tickets), but legislators may be regretting the change.
Last year operators reported a hold of over 13% and turned the $337 million handle into $46.3 million in revenue. That gave Tennessee $8.7 million in taxes.
But, last month, the state’s tax bill reached $7.7 million, even though Tennessee sports betting took in $80 million more in bets. With their current tax rate of 1.85% of gross revenue, they would have needed $475 million in wagers to get the same amount in taxes as September 2022 (Tennessee has never reported more than $450 million in bets).
At least the tax bill was higher than August’s $4.6 million.
