The US Could Receive up to $15 Billion in Taxes if Online Casinos Legalized in All States
London-based research firm Vixio, commissioned by gambling company Light & Wonder, studied the potential impact of legalizing online casinos throughout the US on tax revenues for the country. Currently, online gambling is legal in only seven states: Connecticut, Delaware, Michigan, New Jersey, Rhode Island, Pennsylvania, and West Virginia.
The researchers concluded that if 44 states allow online casinos, the country will potentially collect from $9 billion to $15 billion in taxes annually. At the same time, the gross revenue of the national iGaming market could grow to $50 billion per year.
According to statistics, online casinos are a more profitable business for the US than sports betting. In 2023, the country received $1.61 billion in tax revenue from the iGaming industry across six states. The data does not include Rhode Island, where the online gambling market was not legalized until March 2024. At the same time, in 2023, the sports betting industry generated $2.06 billion in tax revenue for the United States. However, this figure was achieved not by 6, but by 29 states where bookmakers were legal at that time.
Another argument in favor of online casinos is the fact that of the six jurisdictions with a legal iGaming industry three are among the least populous states in the country. West Virginia ranks 39th, Rhode Island is 44th, and Delaware is 45th in terms of population. Vixio researchers believe that if online casinos are legalized in more populous states (such as New York or California), their gaming revenues will be higher than in current markets.
Last year, combined gross iGaming revenue across six jurisdictions reached a record $6.17 billion, up nearly 23% from 2022. Of the total, more than 90% came from densely populated areas of New Jersey, Michigan, and Pennsylvania.
In other news, the casino license bidding process in New York is unlikely to speed up.
