Maryland Raises Mobile Sports Betting Tax to 20% Amid Budget Needs
Maryland’s online sportsbook operators are facing a significant tax increase after Governor Wes Moore signed House Bill 352, raising the tax rate on mobile sports betting from 15% to 20%. Enacted on May 21, the new law aligns Maryland with states like Illinois and Ohio, both of which have adopted similar tax measures. The increase, part of the Budget Reconciliation and Financing Act of 2025, is a compromise following Governor Moore’s initial proposal for a 30% tax, aimed at addressing a $2.7 billion budget shortfall.
Legislators opted for a lower rate after substantial debate, ultimately approving the amended bill by a 13-5 vote. Prominent leaders, including Senate President Bill Ferguson and House Speaker Adrienne A. Jones, endorsed the compromise, which also dropped plans to raise casino table game taxes from 20% to 25%.
The law not only adjusts tax rates—5% of mobile betting revenue will now go to the general fund, with the remaining 95% supporting educational initiatives through the Blueprint for Maryland’s Future Fund. Since its launch in December 2021, the state’s sports betting market has contributed over $160 million to education programs, with projections indicating an additional $32 million by fiscal year 2026.
The new tax structure poses challenges for operators like DraftKings, which anticipates a $30 million revenue decline in 2025 due to the tax hike. Maryland’s measure is part of a national trend as other states, such as Louisiana and New Jersey, consider similar increases.
As states reevaluate their sports betting tax policies, Maryland’s legislation signifies a shift towards generating more revenue to fund public services, particularly in education, while navigating the complex dynamics of maintaining competitive markets within the industry.
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