North Carolina’s Pending Sports Betting Tax Hike Expected to Yield Negligible Revenue Bump

Posted on: June 8, 2026, 09:12h. 

Last updated on: June 8, 2026, 10:01h.

Devin O'Connor @CasinoorgDevinO Read More
Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.
  • North Carolina is likely to raise its tax on online sportsbooks
  • The state is mulling $3 billion in new spending in its budget plan
  • The state’s sports betting tax amounted to $116.6 million in the 2025 fiscal year

North Carolina’s pending sports betting tax hike could prove to be a backdoor boon for the black market, with licensed operators warning that higher state levies will force them to slash odds and unintentionally fuel illegal gambling.

North Carolina sports betting tax
The State Farmers Market Restaurant in Raleigh. North Carolina lawmakers are expected to raise the state’s tax on its commercial sportsbook operators through the 2025-2027 budget. (Image: Shutterstock)

Commercial sports betting in North Carolina went live in March 2024. Today, there are eight regulated online sportsbooks, while in-person retail sports wagering operates at tribal casinos.

Under current legislation, the commercial sportsbooks are required to share 18% of their gross sports betting revenue, or the amount of money the oddsmakers keep after paying out winning bets, with the state. During the current 2025-2027 biennial budget negotiations, reports have surfaced that the odds are good that lawmakers will increase the state’s tax on sports betting.

While initial rumblings suggested the levy could surge by 12%, WRAL reports that lawmakers will likely only raise the sports betting tax by 2% to 7%.

Sports Betting Taxes Aren’t Much 

North Carolina lawmakers are scrambling to find ways to fund $3 billion in higher spending at a state level.

Gov. Josh Stein (D) wants to give public education teachers $1,500 bonuses and $300 for classroom supplies. Stein additionally seeks to provide almost $380 million in tax cuts to lower- and moderate-income families. The governor has also proposed 10% pay increases for law enforcement and state public safety officers.

North Carolinians bet billions of dollars on sports, more than $6.4 billion last year and $15.3 billion since March 2024. The bets, however, don’t translate to significant taxes.

During the 2025 fiscal year (July 2024 through June 2025), sportsbooks generated gross revenue of $647.7 million. At 18%, the state tax collected $116.6 million.

By raising the sports betting tax to 25%, the state’s take for the 2025 fiscal year would have only climbed to $161.9 million, a net difference of $45.3 million.

Stein’s budget proposes spending more than $35.4 billion over the three years. Three years of sports betting taxes, an estimated $485.7 million on the increased 25% tax, would account for just 1.37% of the spending plan. 

Customer Concerns

Advocates for low sports betting taxes argue that increased levies are often passed on to consumers. Bettors in highly taxed sports betting jurisdictions often see fewer sportsbook incentives and promotions, like free play and odds boosts.

Bettors in highly taxed states also complain about being offered worse odds than in states with lower taxes.

This tax hike will only penalize licensed, regulated companies who have delivered hundreds of millions in tax revenue to the state,” the Sports Betting Alliance said in a statement to WRAL. “We urge state leaders to instead focus on strengthening the legal framework that protects players, supports jobs, and keeps illegal and unregulated operators out of North Carolina.”

North Carolina’s 18% sports betting tax is around the middle range of those 39 states that have legalized and tax sports betting.