TLDR
- North Carolina lawmakers voted to raise the online sportsbook tax rate from 18% to 23%
- The state has collected over $299 million in tax revenue since sports betting launched in March 2024
- Bettors placed more than $561 million in wagers in May 2026 alone — the ninth straight month above $500 million
- The Sports Betting Alliance warned the hike penalizes licensed operators who have already delivered major tax revenue
- North Carolina now sits above New Jersey, Massachusetts, and Ohio in tax rate, but well below New York’s 51%
North Carolina has raised the tax rate on online sports betting operators from 18% to 23%, effective after lawmakers passed the change in June 2026. It is the first rate change since the market opened in March 2024.
The increase adds five percentage points to what licensed sportsbooks pay the state on their gross revenue.
Strong Betting Numbers Behind the Decision
The state’s wagering numbers have grown steadily. In May 2026, bettors placed more than $561 million in wagers. That was the ninth month in a row that total bets cleared $500 million.
From January to May 2025, bettors wagered $3.0 billion. In the same period in 2026, that number rose to $3.2 billion. Since launch, total wagers have exceeded $15 billion.
Gross operator revenue since March 2024 has hit $1.6 billion, generating $299 million in tax revenue for the state. If the 23% rate had been in place from the start, North Carolina would have collected an extra $83 million, according to WRAL’s Brian Murphy.
Lawmakers plan to direct the additional revenue toward gambling addiction treatment, youth sports, the Major Events, Games and Attractions Fund, and athletic departments at 13 UNC System universities. Funds also flow to education, public safety, transportation, and health care through the general fund.
House Speaker Destin Hall called the policy a success. “It’s been a tremendously successful policy in this state,” he said. “A lot of people apparently like to do that sort of thing for one reason or another.”
A proposal to push the rate as high as 50% was considered before lawmakers settled on 23%.
Operators Push Back on the Rate Hike
Licensed operators are not pleased with the change. The Sports Betting Alliance, which represents sportsbook companies operating in North Carolina, said the increase punishes firms that have already paid hundreds of millions into the state.
“This tax hike will only penalize licensed, regulated companies who have delivered hundreds of millions in tax revenue to the state and the UNC System athletic departments,” the group said in a statement.
FanDuel sent an electronic letter to customers warning that college sports funding could take a hit. “Legal sports betting is generating real revenue for collegiate athletic departments across the state,” it said. “A tax hike would threaten that funding and hit fans.”
With the 23% rate, North Carolina now ranks above New Jersey at 19.75%, Massachusetts at 20%, and Ohio at 20%. It sits below Pennsylvania at 36%, Illinois which ranges from 20% to 40%, and New York, New Hampshire, and Rhode Island, which each take 51% of operator revenue.
Delaware sits at 50%.
