What kind of tax revenue will New Jersey make from sports betting?
Sports betting is coming to New Jersey. If you haven’t heard, the Supreme Court of the United States struck down PASPA to pave the way for legal sports betting in the Garden State. And you can bet you’ll find online sports betting at ResortsCasino.com soon.
This has huge implications for New Jersey. First and foremost, New Jersey residents will be able to bet on sports legally and safely. It’s something that’s already being done nationwide to the tune of billions of dollars at illegal offshore sites that aren’t necessarily easy to trust. Soon, sports betting will be done safely at regulated Atlantic City casinos.
That means you’ll be able to bet on sports and win along with your favorites, potentially making money. It also means more taxes for the state coffers, which is good for all kinds of public initiatives.
But how much money are we talking about? According to predictions from the State Treasurer, New Jersey stands to gain $13 million in tax revenue. This is based on an estimation of $124 million in gross gaming revenue.
Why the relatively low number? For starters, this is a first-year prediction, in a non-mature market. The estimate is likely to be on the conservative side and is probably rooted more in reality than predictions for the first year of legalized online casinos.
And online casino revenue is a good guide. First-year online casino revenue is a fraction of what it is today. As the market matured and people became more familiar with online casino and online poker in New Jersey, revenue grew year over year.
For a more accurate prediction, we can look to Nevada where sports betting is and has been legal. That state generated about $250 million annually. Nevada’s population is much smaller at around 3 million to New Jersey’s 9 million.
Even at the low end, tax revenue is always helpful and the sports betting market will most likely continue to trend upward, just as it has for online gaming.