RALEIGH, N.C. – North Carolina lawmakers are weighing an increase to the state’s sports wagering tax, but early estimates show the higher rate would deliver only a marginal boost to state coffers while potentially weakening the legal market.
Commercial sports betting launched in North Carolina in March 2024. The state now has eight licensed online sportsbooks, while in‑person wagering is limited to tribal casinos. Operators currently pay an 18% tax on gross wagering revenue — the amount kept after paying out winning bets.
As lawmakers negotiate the 2025–27 budget, reports indicate the General Assembly is likely to raise the tax rate. Initial speculation suggested a jump of up to 12 percentage points, but WRAL reports the increase under consideration is between 2 and 7 percentage points.
Small Fiscal Impact
State leaders are searching for ways to cover roughly $3 billion in new spending. Gov. Josh Stein, a Democrat, has proposed $1,500 bonuses for public school teachers, $300 classroom supply stipends, nearly $380 million in tax relief for low‑ and middle‑income families, and 10% raises for law enforcement and public safety officers.
Despite the billions wagered in the state, sports betting contributes only a sliver of the overall budget. North Carolinians bet more than $6.4 billion last year and $15.3 billion since legalization, but the tax haul remains limited.
Sportsbooks generated $647.7 million in gross revenue during the 2025 fiscal year. At the current 18% rate, the state collected $116.6 million. Raising the tax to 25% would have increased that figure to $161.9 million — a difference of $45.3 million.
Stein’s three‑year, $35.4 billion spending plan would receive just 1.37% of its funding from sports betting taxes even under the higher rate, which would total an estimated $485.7 million over the biennium.
Industry Pushback
Operators argue that higher taxes ultimately fall on consumers. In states with steep levies, bettors often see fewer promotions, reduced bonus offers and less favorable odds — factors that can drive them to offshore or illegal bookmakers.
“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 current 18% rate sits near the middle of the 39 states that tax legal sports betting.
