Rhode Island sportsbook revenue slumps 17% in April
Plantation State reports 38% year-on-year handle increase but March Madness and 51% tax rate impact hamper ongoing revenue growth
Rhode Island has reported a 17% year-on-year (YoY) decline in its combined sportsbook revenue during April, with the Plantation State’s revenue slumping to just $2.6m.
Releasing its sportsbook report for the fourth month of 2022, the Rhode Island Lottery confirmed the YoY declines were punctuated by falls in revenue at the Twin River Resort and in the state’s online casino sector.
Online sportsbook revenue in Rhode Island fell by 24% YoY during April to $1.2m, despite a 58% increase in handle over the same period, with online handle rising to $25.4m.
The Twin River Resort also reported the same dichotomy of results in April, with revenue dropping 16% YoY to $802,433, while online handle rose 12% in the same period to $9.8m.
The Tiverton casino bucked this trend however, reporting YoY rises in both key metrics.
Tiverton sportsbook revenue rose 5% to $548,010, with its online handle rising by double-digits (17%) to $4.8m.
Rhode Island became the eighth state to operate sports betting in 2018, just months after the US Supreme Court revoked PASPA, later expanding its existing statutes to include mobile and online betting.
The original law limited sports betting to in-person only at the Twin River casinos, but the legislature soon realized that was a mistake and passed an expansion to allow statewide mobile betting signing the bill into law in March 2019.
International Gaming Technology (IGT) oversees the Rhode Island Lottery’s mobile sportsbook operations, which are powered by William Hill, with the two land-based casinos operating their own in-house sportsbooks.
These operators pay a tax rate of 51% on gross sports betting revenue, one of the steepest tax rates for betting in the US for a monopoly-based sportsbook market, mirroring that of nearby New Hampshire, which has its own monopoly and charges 51%.
Sportsbook taxation revenues are split 51% to the state, 32% to IGT and 17% to the respective casino operator.
The high taxation rate presents a serious impediment to long-term profitability of Rhode Island’s sportsbooks.
New York also levies a 51% taxation rate on sportsbooks and is currently the highest taxing state multi-operator sportsbook market in the US.