North Carolina Lawmakers Are Weighing a Sports Betting Tax Hike That Could Reach 30 Percent

North Carolina’s state budget negotiations have included discussions of a significant increase to the sports betting operator tax rate, according to people familiar with the talks who spoke to WRAL. The discussions have centered on a range of 20 to 30 percent, up from the current 18 percent that has been in place since the market launched in March 2024. No final decision has been made, but the proposals are serious enough that the Sports Betting Alliance has already started pushing back against any increase.

Since launch, North Carolina’s eight licensed operators have paid more than 87 million in combined taxes, a number that has made the state’s sports betting market an attractive revenue target as lawmakers try to close budget gaps. Proposals under discussion also include a new per-bet tax on individual sports wagers and changes to lottery sales taxation, though those ideas are seen as facing even steeper political obstacles than an operator rate hike.

The Operator Tax Debate

North Carolina already tried this once. The state Senate included a 36 percent tax rate in last year’s budget proposal, which would have made North Carolina one of the highest-tax sports betting markets in the country. The House rejected that figure, and the two chambers never reached a final budget deal, leaving the rate at 18 percent. Budget talks this year appear to be converging on something more modest, but even a move to 25 or 30 percent would significantly raise costs for operators who are also facing a growing competitive threat from prediction markets that pay no comparable state taxes.

Governor Josh Stein has been a consistent supporter of legal sports betting in the state and would likely resist provisions that strain the market he helped build. North Carolina sportsbooks have had a strong first two years, and major operators have made significant marketing investments in the state. A steep tax hike at this stage could slow that investment and reduce the promotional activity that drives new user acquisition.

What Bettors Should Expect

For bettors in North Carolina, the most direct effect of a higher operator tax would likely come through fewer promotions and potentially tighter odds margins as sportsbooks seek to offset rising state costs. The timeline is tight: if a tax hike is included in the budget, it could take effect as early as July 1. The legislature has until August before adjournment, and with pressure to finally pass a full budget after last year’s failure, there is urgency to resolve these disputes. How North Carolina handles this decision will be watched nationally as other states facing budget shortfalls consider their own options for squeezing more revenue from the sports betting industry.