North Carolina celebrated the one-year anniversary of its legal sports betting era on Tuesday, and the data shows it has been a resounding success.
The nation’s 38th state to license sports betting operators reported a handle of more than $6.6 billion from last March to last month, showing, that there is indeed an appetite for wagering in the Tar Heel State. For some perspective, Nevada, where sports betting has been legal for 94 years, reported a 2024 handle of $7.9 billion.
However, perhaps the best way to show how successful North Carolina sportsbooks have been is through the tax money generated. For its first 12-month period, the state received $127.6 million. That’s nearly double the $65 million proponents said the state would see in the first year when lawmakers passed the wagering bill two years ago.
That’s nearly twice as much money going into the state’s General Fund and additional dollars for athletics programs at 13 state universities. It also gives the state more funding to bring major events to the state.
Problem Gambling Should Benefit From Windfall
Considering the windfall the state received these past 12 months and the likelihood that the trend will continue in the years to come, state lawmakers should re-examine how it allocates the funding from North Carolina sports betting apps.
When lawmakers passed House Bill 347 in 2023, it stipulated that $2 million from revenues generated by the 18% gaming tax would go to support the North Carolina Problem Gambling Program. At that time, the state expected to receive $64.6 million in revenue during the 2024-25 fiscal year and nothing in FY 2023-24. The 2024-25 FY doesn’t end until June. From July 2024 to last month, the state’s revenue is just shy of $79 million.
With the state essentially doubling what it expected to receive already, lawmakers should reconsider the funding allocations. Specifically, the amount the state sets aside for problem gambling issues. HB 347 set that amount at $2 million annually, while other beneficiary programs received a percentage share.
Addressing problem gambling disorders – and March is Problem Gambling Awareness Month – is woefully underfunded nationwide. North Carolina can become a leader in tackling problem gambling and helping those in need of treatment by doubling its commitment to the program and/or setting aside additional funding for the Gambling Research and Policy Initiative at East Carolina University. That’s led by Dr. Michelle Malkin, one of the nation’s top experts on gambling addiction.
Ax The Tax On Carolina Sports Bettors
While the first year of North Carolina sports betting went very, very well, there is at least one issue the state needs to address. That is to allow residents to deduct gambling losses to offset their winnings when filing their state tax returns.
Over the course of a year, a typical bettor who signs up with operators offering NC sports betting promo codes will place several wagers. And they might do so through several of the eight licensed operators, which include BetMGM, FanDuel and bet365. Bettors might make a profit at one and experience losses at others. Under North Carolina’s current law, a bettor who wins $250 at one sportsbook and loses $400 at another would still be responsible for paying state income taxes on the $250.
State Rep. Erin Pare, R-Holly Springs, filed House Bill 14 in the North Carolina General Assembly this year that would allow taxpayers who itemize on their state return to offset their winnings by deducting losses up the same amount. That’s the policy for the federal government and most states. HB 14 has bipartisan support, including leaders from both Republican and Democratic caucuses in the House.
According to The Carolina Journal, one North Carolina resident told lawmakers at a hearing last month he stopped betting after discovering the state’s tax policy. “It’s tough enough to beat the house, much less also pay additional taxes when you win,” James Joyce said.
The measure passed the state House Commerce and Economic Development Committee in March. It needs House Finance Committee approval before it can go to the floor for a full vote.
