EKG LINE: WILL NC TAX HIKE PASS?
A weekly newsletter with gambling industry insider insights from the Sports Betting & Emerging Verticals team at Eilers & Krejcik Gaming
WILL NORTH CAROLINA TAX HIKE PASS?
The North Carolina Senate last week proposed bill S 257 to double the online sports betting tax rate from 18% GGR to 36% GGR.
The proposal comes as part of North Carolina’s annual budgeting process, which must be complete before the fiscal year ends on June 30. It also comes as the state is facing a $1bn deficit in FY27.
Our initial read is that the measure is more likely to fail than pass.
First, the current rate is 18% GGR, or right around the national average of 20%. The most successful tax rate increases have come in states with more objectively “low” tax rates, like Ohio’s 10% NGR rate or Maryland’s 15% AGR rate.
Second, the proposal has thus far only come from the Senate. Governor Josh Stein’s proposed budget, released last month, aimed to address the projected deficit by freezing personal and corporate tax rates. We presume that if Stein wanted a sports betting tax increase, he would’ve proposed one.
Of note, the most successful tax increases have been driven by governors (e.g., Ohio, Illinois, Maryland).
We also have not seen the North Carolina House’s proposed budget, scheduled to be released in the coming weeks.
Our passage odds could increase if the House and Senate are united on increasing sports betting tax obligations.
Finally, the politics in North Carolina are trickier than other states that have successfully executed tax rate increases. Governor Stein is a Democrat, but both chambers in the legislature are Republican-controlled.
Bottom line: We lean negative on the bill’s passage as written but that could change if we see support from the House or perhaps more importantly, the Governor.
2. PODCAST: INSIDE MARCH MADNESS LIVE TRADING
Host Brad Allen is joined by Bettormetrics trading analyst Alfie Arrands to discuss March Madness live betting metrics, including:
How Hard Rock changed its strategy between early and late rounds
Why DraftKings could be the U.S. live betting leader
Listen to the episode here.
3. TRENDING UP / TRENDING DOWN
Trending up: Government affairs spend. Both FanDuel and DraftKings gave around $500,000 towards the Trump inauguration, per Front Office Sports. A FanDuel spokesperson told FOS it was “part of FanDuel’s regular government affairs activities” and an “opportunity to meet with state legislators from across the country in one place at the same time.”
Trending down: OSB ads. The amount of sports betting ads declined 17% in 2024 per Neilsen and the American Gaming Association, and are now down 44% since their peak in 2021. The decline is partially due to the cost of advertising, with total ad spend relatively flat, but that money now buying less air time.
4. CHART OF THE WEEK: WHO IS THE BIGGEST U.S. ONLINE CASINO SUPPLIER?
The chart above, taken from our latest Online Game Performance Database shows supplier GGR share of the U.S. online casino market for March 2025.
Evolution and IGT have been neck and neck atop the market for well over a year now, although both are down around 1.5pp in share since March 2024.
Light and Wonder also lost around 2pp share in that time, suggesting the market is becoming more competitive and less consolidated in the biggest suppliers.
The big gainers are Games Global and White Hat Studios which are both up around 2pp in the past 12 months.