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Massachusetts Legalizes Sports Betting

Tax Development Aug 15, 2022

Massachusetts Legalizes Sports Betting

House Bill 5164 created the legalization of both online and physical sports betting in Massachusetts and was signed by Massachusetts Governor Charlie Baker on August 10, 2022. There is not yet a specific date when sports bets can be placed in Massachusetts.

The passing of this bill makes Massachusetts the 36th state to legalize sports betting and the 19th to legalize online sports betting.1 Additionally, the passage of this bill legalizes both professional and collegiate-level sports betting, with an exception for in-state collegiate-level sports, unless the team is in postseason competition.

The bill provides for an excise tax of 15% for in-person betting and an excise tax of 20% on mobile betting. The tax will be levied against the betting companies and their adjusted gross sports wagering receipts. “Adjusted gross sports wagering receipts” means the total gross receipts from sports wagering, less the sum of (i) the total of all winnings paid to participants, and (ii) all excise taxes paid pursuant to federal law. The total of all winnings paid to participants does not include the cash equivalent of any merchandise or thing of value awarded as a prize.

The sports betting industry is one of the fastest-growing industries, with some indicating that there may be as much as $37 billion spent on sports gambling by the year 2025.2 It has been estimated that Massachusetts could see additional revenue of up to $35 million per year from the taxes generated from sports betting.3

1 American Gaming Association

2 PR Newswire “Online Sports Betting Industry Projected to Grow from $9.5 Billion Last Year To $37 Billion In 2025”

3 Colin A. Young, State House News Service, April 29, 2022


Brian Stromen

Christopher Potter

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