Legal sports betting has quickly become a significant source of income for states nationwide. As more people shift to online sportsbooks and mobile betting apps, New York sports betting revenue has surged significantly, resulting in a major boost in tax revenue.
However, there are still debates about how this money is used and whether the benefits outweigh the risks.
In this report, we’ll look at where New York’s sports betting revenue comes from, the amount of tax it generates, fund allocation, and the ongoing debates about its social and ethical impact.
Legal Online Sports Betting in New York
The US sports betting industry is now in its seventh year of regulated operations outside Nevada and has seen impressive growth since the fall of PASPA in 2018. To date, operators have generated $35 billion in lifetime gross revenue from over $400 billion in total handle. While New York’s online betting market is still young, it’s set to become a major player.
Thanks to the Upstate New York Gaming Economic Development Act passed in 2013 and a regulatory framework established in 2019, in-person sports betting has been legal in New York for years. However, the state has missed out on significant tax revenue compared to neighboring New Jersey and Pennsylvania.
Recognizing this, in November 2021, former Governor Cuomo authorized mobile betting in New York. The New York State Gaming Commission was put in charge of all mobile betting operations and recommended nine online bookmakers for mobile licenses in the state.
The market officially launched in January 2022, and the results were impressive—nearly $1.7 billion in wagers placed in the first month of operation. Compared to the $21 million wagered in December 2021, this represents an impressive 8,000% increase. Since then, New York’s betting market has only continued to grow, generating over $51 billion in total bets.
State by State Breakdown: How NY Compares
The Empire State always had what it took to be a top player in sports betting. The New York market holds huge potential with a massive population, a devoted fan base, major sports franchises like the New York Mets, and other teams from the NFL, NBA, and NHL.
It is already closing the gap on New Jersey, which has dominated the leaderboard since it surpassed Nevada in April 2021. With its explosive growth, many expect NY to take the top spot within the next year.
| State | Handle | Revenue | Hold | Taxes |
| New Jersey | $54.9 billion | $4.2 billion | 7.7% | $587 million |
| New York | $51.7 billion | $4.6 billion | 8.9% | $2.3 billion |
| Nevada | $42.4 billion | $2.5 billion | 5.8% | $165 million |
- Handle: The total amount of money bet on sports.
- Gross sports betting revenue: Total handle minus winning bets.
- Hold: The percentage of the handle that sportsbooks keep as revenue.
- Taxes: Share of gross betting revenue that goes to the state.
Lifetime New York Betting Tax: Breakdown
Out of the $51 billion of lifetime sports betting handle, the state has generated over $2.3 billion in NY sports betting tax revenues. Here’s a breakdown by major providers.
| Online Sportsbook | Handle | Gross Gaming Revenue | Tax |
| FanDuel | $20.6 billion | $2.2 billion | $1.1 billion |
| DraftKings | $17 billion | $1.4 billion | $738.9 million |
| Caesars | $6.3 billion | $457 million | $232 million |
| BetMGM | $3.7 billion | $241 million | $123 million |
For comparison, retail casinos have brought in $384 million in total handle and $61 million in gross gaming revenue, with Rivers taking the lead, followed by Del Lago and Resorts World.
October 2024: New Record High in NY Sports Betting Handle
New York players spent $2.32 billion in October on online sports, which is the highest monthly total handle to date and the fifth time New York sportsbooks topped $2 billion.
This represents a 9.4% increase from the previous record-high set in November 2023. At the same time, it’s a 14.9% year-on-year increase and a 15.4% jump from September.
Despite the record handle, NY sports betting revenue fell to $176.3 million—a 5.7% increase from last year but 14.5% below September’s figures. This also fell short of the $211.7 million state record set in January 2024.
Top Operators:
- FanDuel: Maintained its lead, with $77.3 million in revenue on $907.6 million in bets (8.52% hold).
- DraftKings: Ranked second with $58.9 million in revenue from $813.7 million in wagers (7.24% hold).
- Fanatics: Rose to third place, generating $12.4 million on a $178.4 million handle (6.95% hold), surpassing Caesars.
- Caesars & BetMGM: Caesars earned $10.9 million (7.03% hold), while BetMGM earned $9.5 million with a lower hold of 5.89%.
The introduction of ESPN Bet in late September likely contributed to the overall boost in New York’s October sports betting handle. In its first full month, ESPN Bet generated $3.2 million in revenue from $40.8 million in wagers, achieving a 7.84% hold and surpassing established competitors like Bally Bet and Resorts World Bet.
Where The Money Comes From
New York’s sports betting revenue is primarily generated through the following channels:
- Online Sportsbooks: Subject to a 51% sports betting taxes NY—one of the highest rates in the nation. This rate has been key in generating substantial tax revenue for the state. In addition to taxes, operators must pay licensing fees and comply with strict regulatory standards set by the New York State Gaming Commission.
- Retail Sportsbooks: Taxed at 10% on gross gaming revenue. This lower New York sports betting tax rate aims to encourage investment in physical casinos and balance the competitive landscape between online and brick-and-mortar establishments.
- Daily Fantasy Sports: DFS platforms operate under a separate regulatory framework and are not classified as sports betting. However, they still contribute to New York’s revenue from sports-related gaming activities.
Mobile Sports Betting Takes Center Stage
Mobile sports betting in New York has entirely transformed the gambling market. In just two years, it has become a top revenue source, bringing in $862 million in tax revenue last year alone and over $1.5 billion since its launch.
During this period, New York has processed around $35 billion in wagers, establishing itself as a national leader in sports betting.
One major advantage of mobile betting is accessibility. People across the state can easily place bets anywhere, anytime. To date, over 5.6 million accounts have been created, and more than 2.6 billion transactions have been conducted, showing strong participation among New Yorkers.
Where The Money Goes
New York is committed to using sports betting revenue to strengthen public services and address potential social challenges associated with gambling.
Most of the taxes on sports betting in NY are directed toward public education, particularly for K-12 schools, SUNY, and CUNY institutions. Since its launch, the mobile sports betting industry has contributed over $2 billion to education funding, improving school infrastructure and resources.
Beyond public schools, each year, $5 million goes to youth sports programs through the NYS Office of Children and Family Services, granting underserved communities access to organized sports.
Another $6 million annually goes to problem gambling education and treatment, administered by the NYS Office of Addiction Services and Supports, focusing on prevention and recovery for those with a gambling problem.
Important Considerations
Balancing the financial benefits of sports betting with the social costs is a hot topic in New York.
The rapid growth of the sports betting market has sparked debates over how the money is spent. Critics argue that the state isn’t investing enough in preventing and treating problem gambling, with only $6 million allocated each year. Earlier this year, there was a proposal to increase this funding to 1% of total sports betting taxes, but it didn’t make it into the budget.
Adding to concerns, recent reports show that calls to New York’s problem gambling hotline have increased. This rise in calls highlights the growing need for support services.
Some also question whether the money for education and youth programs is having the impact it should, given the high New York gambling tax.
Although 95% of sports betting revenue is directed toward education, critics say this overstates its real impact. In practice, sports betting revenue has only covered about one out of every eight dollars spent on education in New York over the past 12 years, making its effect seem smaller than the percentage suggests.
An Issue Not Likely to Be Resolved Anytime Soon
New York’s sports betting industry has quickly become a key revenue source. The state has seen rapid growth since it legalized mobile betting, processing billions in wagers every month.
However, while the financial benefits are clear, concerns about the social costs are growing, too, with critics arguing that problem gambling funds are insufficient.
As New York continues to set new benchmarks, finding the right balance between revenue generation and responsible gambling practices will be key for sustainable growth in this sector.
