Massachusetts Sports Betting Revenue, Handle and Taxes

Massachusetts Sports Betting Revenue

On January 31, 2023, retail sports betting became available in Massachusetts. Then on March 10, 2023, online and mobile sports betting became open to all residents, as well. Barstool, BetMGM, Caesars, DraftKings, FanDuel and WynnBET were the first six sportsbooks to join the MA sports betting era, and in such a populous area it can be expected that number will grow, as will the impact from the retail side of things. It is very early into MA online sports betting, but Massachusetts sports betting revenue has been performing very well and growing at a steady pace. It is clear the market for sports betting was ready to be explored.

During January and February of 2023, MA only had retail sports betting options available. Massachusetts sports betting revenue kicked off with a loss of $7,248 USD in January, which was followed by a gain of $2,072,672 USD. However, these numbers were nothing of what was to come. Since the allowance of online sports betting in MA, Massachusetts sports betting revenue skyrocketed to $48,289,185 USD, $60,301,564 USD and $62,073,252 USD. The online aspect really got MA residents excited, which resulted in massive growth.

High Massachusetts sports betting revenue is not a shock to see in the state of MA. Major league teams like the Boston Red Sox, Boston Bruins, New England Patriots and Boston Celtics make this a passionate state when it comes to sports. This is included with an ultra-passionate fanbase for the many NCAA schools nearby.

Massachusetts Sports Betting Taxes

A contributing factor to the financial results of sports betting in MA, is Massachusetts sports betting taxes. Online sports bettors are highly inclined to keep as much of their profits as possible, so a topic such as this could make or break the popularity of sports betting in a state. The Massachusetts sports betting tax rate currently sits at 20% of all GGR for online betting, and 15% of GGR for retail betting. These rates are quite fixed, as Massachusetts sports betting taxes do not include reduced tax pressure for things such as free wagers, promotional play and federal excise tax on handle as some states allow. A high Massachusetts sports betting tax rate as well as a lack of tax relief could potentially lower Massachusetts sports betting hold percentage and Massachusetts sports betting handle.

The average tax rate in US sports betting is 19%, so the Massachusetts sports betting tax rate is just above par compared to other states. While they may be above average, when comparing MA to 25 other counterparts, you can see that there are six states that charge a higher retail betting tax rate, and there are six states that charge a higher online tax rate. Some rates go as high as 51% on both the retail and online side of things. As of right now, the Massachusetts sports betting taxes are nothing out of the ordinary.

Massachusetts Sports Betting Handle

Sports betting handle refers to the total amount of money that has been wagered by a specific population. Massachusetts sports betting handle kicked off in January with six figures, and then eight figures in February. Those numbers came from retail betting alone, and since online betting became a factor in March, MA is seeing nine-figure handles per month. The most recent Massachusetts sports betting handle came in at $454,965,416 USD for the month of May. In 2023 from January to May, the Massachusetts sports betting handle has totaled at $1,628,557,055 USD thus far. It is clear that the online component of sports betting is crucial in MA, as online handles accounted for over 95% of the overall Massachusetts sports betting handle.

MA’s largest handle result since the legalization was $579,262,823 USD, which took place in April of 2023. This was due to the NHL and NBA being in full swing with their respective playoffs. Online sports betting has only seen NHL and NBA action for three months, and has yet to see NFL and college football. When these sports return, there is a high likelihood of an increase in Massachusetts sports betting hold percentage, Massachusetts sports betting handle and Massachusetts sports betting revenue.

Massachusetts Sports Betting Handle Per Capita

When analyzing sports betting statistics such as revenue and handle, it is likely that the states with high populations are going to own and dominate the results. This is the case for MA, but these are skewed numbers due to major population differences in each and every state. That is why the Massachusetts sports betting handle per capita is important to watch to get another viewpoint into the state’s success.

MA has a population of roughly 6,950,000 people, but a state such as Illinois has a population of over 12,500,000 people. In May of 2023, MA finished the month with a handle of nearly 454,965,416 USD. The Massachusetts sports betting handle per capita would be calculated by dividing the handle by the population. In this case, the Massachusetts sports betting handle per capita would be $65.46 per person. As for Illinois, who had a handle of almost $821,715,720 USD in May of 2023, their sports betting handle per capita calculates to $65.73 wagered per person. These numbers are identical, but when looking through a certain lens, one would see that Illinois is much better off since they made almost twice what MA made. However, sports betting handle per capita proves that both states perform at a similar pace.

Massachusetts Sports Betting Hold

Sports betting hold refers to the percentage of money that a sportsbook keeps for every dollar that has been wagered by users. Massachusetts sports betting hold percentage is averaging 10.61% in the year 2023. This is an impressive average due to the fact that in their first month, bettors won more than what was wagered overall. This resulted in a negative Massachusetts sports betting hold. However, now Massachusetts and their sports betting platforms are keeping almost 11% of wager funds from bettors – which is a very high total compared to the overall average of 9.05% with all states included.

While this shows great efficiency of revenue held, it can also come across as risky to the MA population. They may refrain from wagering often and at high amounts, because the percentages may not be in their favor as opposed to other states. Since 2018, the industry hold average has never surpassed a total of 10% for an entire year, but the average is increasing at a steady pace. It seems likely that the Massachusetts sports betting hold average and industry average will be closer in the years to come, which will level the market and camouflage any concerning hold rates.