New York Sports Betting Laws
Legalization of sports betting would allow people to wager money on sports. Though this can increase tax revenue, it also increases risk. However, legalizing sports betting would protect Americans’ freedom of choice and provide people with more control over their money. If approved, legal sports betting would be available in eight or nine states by the end of 2018, and at least 14 states will offer the option by the end of 2020.
Several states have already approved legislation allowing for sports betting. Maine lawmakers passed the legislation in June, but the governor vetoed the bill. However, the legislature may try again in the future. In contrast, Utah has an anti-gambling stance that is written into the state constitution. If it passed sports betting legislation, it would be a dramatic departure from decades of opposition.
Tax rates for sports betting are set by each state, but New York has the highest of all. A tax rate of 8.5% applies to gross wagering, and 85% goes to the Commercial Gaming Revenue Fund. The remaining 5% is used to fund problem gambling programs, regulatory costs, and market origin credits. These credits are derived from the pari-mutuel statute and the purses of racing associations and state breeding funds. The New York Thoroughbred Horsemen’s Association presented its support for sports betting during a recent state Senate committee hearing. The racing association said that their new account wagering service will allow for fixed-odd proposition wagering.
Sports betting is big business in Michigan, and politicians have big eyes for potential gambling revenues. Michigan’s tax rate for sports wagering is 8.4% on adjusted gross sports betting receipts. In addition, sportsbooks in Detroit pay 1.25% in city taxes. Meanwhile, Delaware has prepared for possible sports betting expansion, offering parlay cards for professional football at three racetracks and a hundred retail locations. This gives it an advantage over other states that have not yet allowed sports betting.
Integrity fees for sports betting are a controversial issue. A proposed fee would give the leagues a small percentage of sportsbooks’ profits. But many leagues have objected to such a fee. The NFL and NBA, for example, do not charge such fees. However, these leagues’ actions have spurred other states to follow suit.
In addition, integrity fees put sports books at a competitive disadvantage to other sportsbooks. Other sports books do not have integrity fees, and can charge their players lower prices. This can hurt their goodwill because the integrity fee could reduce their handle.
As the world of sports betting expands, so does its advertising value. During the pandemic, top sports betting companies generated 10.6 billion television ad impressions, even though mainstream sports leagues were largely inactive. Meanwhile, out-of-home sports betting advertising has increased 193% since last year. While the cost per acquisition may seem high, the lifetime value of a customer can make up for this.
Sports betting ad spend is largely concentrated on national television, but operators in the United States are also advertising through other media. Local TV ads are more effective than national ones. While legal sports betting is slowly rolling out across the country, online sports betting brands are expected to spend $320 million on advertising in 2021 – a 38% increase over the year before. While the majority of this money was spent on national television, it was split among only 11 brands and only 3% of that amount went to digital ads.