Despite it being a market that is less than two months old, Ohio lawmakers are already looking to alter the local sports betting economic landscape. Governor Mike DeWine has proposed alterations to the current betting regulations. One of these changes includes increasing the tax rate on gross gaming revenue (GGR). Ohio sportsbooks are currently taxed at 10%. Gov. DeWine’s proposal would double this.
Ohio Sportsbooks Could See Tax Increase
The current 10% rate is similar to several online markets across the nation. Notable exceptions include Arkansas and New York which tax sportsbooks at 51%, and Pennsylvania which tax sportsbooks at 36%. Ohio’s proposal of 20% would not fall in the higher end of the spectrum. It would, however, bring in more revenue for the Buckeye State according to Gov. DeWine.
A motivation for this could be Ohio’s success during Super Bowl weekend. According to GeoComply’s report, Ohio was on the higher end of sports betting activity surrounding SB 57. Sportsbooks saw 12.6 million geolocation checks during the weekend. This surpasses established markets like Philadelphia which saw 11.8 million and was just shy of New York’s 13.9 million.
Operators Likely To Oppose Proposal
It is likely that operators would protest. This would increase the tax rate that they already agreed upon when applying for their betting licenses. A higher tax rate could also deter some operators from applying in the future. Arkansas is an example of this. With its 51% tax rate, many top sportsbooks have opted to not offer their product in the Natural State.
Ohio’s success, however, makes it unlikely that it would suffer the same fate. Ohio is already one of the biggest sports betting markets and this position could see them get away with raising the tax rate. While there will be complaints, sportsbooks will continue to flock to the Buckeye State.
