House budget retains North Carolina's 18% tax rate in Senate disagreement
Fiscal plan for the next two years from the House does not include any tax increase, despite the Senate proposal to double rate to 36%
North Carolina’s planned online sports betting tax hike from 18% to 36% has been delayed after the House’s budget failed to replicate the Senate’s proposed increase.
In April, the Senate’s budget for 2025-27 was approved and included a 100% tax increase for operators in the Tar Heel State.
However, the House’s version of the budget failed to match the increase, instead retaining the existing level of 18%.
The House budget did include some changes to where tax revenue would be allocated, including giving funding to the University of North Carolina and North Carolina State.
North Carolina’s online sports betting market went live in March 2024, with what is considered a palatable tax rate. A hike to 36% would put it on par with Pennsylvania but behind New York’s 51%.
Both the House and Senate will now be required to thrash out the final details of a budget by July 1.
Should any tax increase be given the greenlight, it would come into effect from October 1.
Since going live, operators in the state have collectively returned around $144m in tax revenue to state coffers.
More than $7.8bn has been wagered in North Carolina in the past 14 months, resulting in operator revenues of almost $800m.
The Sports Betting Alliance (SBA), which represents operators including DraftKings and FanDuel, has urged North Carolina residents to lobby lawmakers to not push through with the tax hike.
A template email on the trade body’s site claims that tax hikes would lead to consumers moving towards black market operators.
The SBA said: “North Carolina lawmakers just introduced a massive tax hike on legal sports betting. If approved, it would mean a 100% tax increase on the sports betting apps you love and trust. With unfair tax hikes like this, everyone loses – but especially fans like you.
“Sports betting tax revenue already generates millions each year for North Carolina. But a 100% increase? That could drive players to the illegal market, putting those funds – and consumer protections – at risk.”
This year has been peppered by proposed tax hikes on US operators, with plans put forward across New Jersey, Ohio, and Maryland in the last five months alone .