Maryland Gov. Signs Mobile Betting Tax Hike into Law

Maryland has decided to increase its tax on mobile sports betting, in line with the broader trend. While some states have rejected tax hikes, Maryland joined those that didn’t, opting for a 20% tax on online sportsbooks.

Maryland Increases Its Mobile Betting Tax

Earlier this year, Gov. Wes Moore proposed raising Maryland’s tax on online sports betting, mirroring similar measures in states, such as Ohio. Moore proposed raising the tax from 15% to 30%, which would have marked a drastic increase.

Moore’s call for a higher tax was primarily motivated by the state’s need to address certain deficits and stabilize its finances.

State lawmakers eventually negotiated a more modest increase, arguing that doubling the tax could have had certain adverse effects. Opponents of the measure argued that it could destabilize the market, harming operators’ businesses. They also implied that tax hikes, such as this one, could encourage other states to adopt similar measures.

Eventually, lawmakers in Maryland agreed to increase the tax to 20% instead. Supporters of this rate said that it would align Maryland’s tax rate to the tax rates in other states, such as Ohio and Illinois.

It should be noted that the tax hike will only affect online sports betting and not in-person betting.

The Extra Funding Will Support Key Initiatives

The 5% increase to Maryland’s tax on mobile sports was outlined in House Bill 352, which Gov. Wes Moore just signed into law. The measure is part of the 2025 Budget Reconciliation and Financing Act and would use the extra money to support a variety of initiatives.

Speaking of which, the bill also changes how the tax revenue from all kinds of sports betting is allocated. Per the measure, 5% of the tax funds will go to the Maryland General Fund. The remainder will fuel the Blueprint for Maryland’s Future Fund, which supports education in the state.

Other States Eye Tax Changes Too

In the meantime, Louisiana’s House Bill 639, which is the brainchild of Rep. Neil Riser, likewise seeks to raise the state’s tax on online betting. If passed, it would more than double the current tax (15%) to 32.5%.

In the meantime, Colorado’s governor just passed House Bill 1311, which ended tax deductions that sports betting operators previously enjoyed, minimizing their incentive to offer promotions. The extra funds generated by this measure would support the state’s Water Plan.