Maryland Tax Rate Hike Could Affect DraftKings and FanDuel

Gov. Wes Moore’s ambitious proposal to hike the tax rate on gambling in Maryland has sparked significant discussion among industry analysts and stakeholders. Unveiled earlier this week, the proposal suggests an increase in the tax on table game winnings from 20% to 25% and a substantial spike in the sports betting revenue tax from the current rate of 15% to 30%. While Maryland’s current sports betting tax is lower compared to neighboring Pennsylvania’s 36% and significantly below New York’s 51%, Gov. Moore’s proposed changes indicate a move toward a more aggressive taxation policy. Despite this, the proposed rates still fall short of those in nearby states, prompting a mixed reaction from the industry.

Industry experts Barry Jonas of Truist Securities and Carlo Santarelli of Deutsche Bank have offered their insights into the potentially far-reaching impacts of this proposal. Jonas, quoted by Complete iGaming, expressed his displeasure, noting the unexpected nature of the proposed changes, particularly for land-based casinos like MGM National Harbor, which might experience the most significant impact. He further suggested that the approval of this tax hike could set a precedent, encouraging other states to consider similar measures. Despite the concerns, Jonas did hint at the possibility of Maryland expanding its gambling options by

Industry experts Barry Jonas of Truist Securities and Carlo Santarelli of Deutsche Bank have offered their insights into the potentially far-reaching impacts of this proposal. Jonas, quoted by Complete iGaming, expressed his displeasure, noting the unexpected nature of the proposed changes, particularly for land-based casinos like MGM National Harbor, which might experience the most significant impact. He further suggested that the approval of this tax hike could set a precedent, encouraging other states to consider similar measures. Despite the concerns, Jonas did hint at the possibility of Maryland expanding its gambling options by adding iGaming, which could bring additional revenue. Santarelli echoed these sentiments, projecting that DraftKings could face a $30 million hit in cash flow if the proposal passes. Furthermore, FanDuel, backed by its parent company Flutter Entertainment, might see an impact of around $58 million, considering its significant presence in Maryland.