NCLGS: Higher Taxes Could Slow the Growth of Legal Sports Betting

United States.- July 16, 2026 | www.zonadeazar.com  The debate over tax pressure on sports betting returned to centre stage during the summer meeting of the National Council of Legislators from Gaming States (NCLGS), where industry representatives warned that excessive tax increases could hinder the growth of the regulated market.

Speaking during a panel on gaming tax policy, Matt Hortenstine, Chief Legal Officer at J&J Gaming, argued that higher taxes reduce operators’ ability to reinvest in innovation, new products and responsible gambling initiatives. In that context, he remarked that “if you strangle the golden goose too much, it will stop laying,” a phrase that summed up the industry’s concerns.

Panellists noted that five U.S. states have increased sports betting tax rates since May 2025, a trend that, according to participants, highlights the need to strike a balance between tax revenue generation and the long-term sustainability of the legal market.

Industry experts also warned that excessively high tax rates could undermine the competitiveness of licensed operators against the illegal market, limiting investment in technology, promotional activities, player protection and product development.

The meeting further highlighted the importance of strengthening dialogue between lawmakers and operators to design tax policies capable of maintaining a competitive regulated market while generating public revenue without discouraging private investment.

The discussion comes at a time when several U.S. states are reviewing their tax frameworks for online gambling and sports betting, while the industry also faces new regulatory challenges related to prediction markets, illegal gambling and changes to federal tax legislation.

Edited by: @_fonta