- New Jersey hiked its online gambling tax to 19.75%, up from 13% for sports betting and 15% for iGaming.
- Operators tied to low-revenue casinos like Caesars Atlantic City, Ocean Casino, and Monmouth Park may face an existential threat.
- Rising costs and shrinking margins could push some sportsbooks out of New Jersey as states nationwide follow with similar tax hikes.
TRENTON, N.J. – New Jersey’s long-standing reputation as a haven for online sports betting just took a direct hit. On Wednesday, lawmakers finalized a deal to raise the New Jersey online sports betting tax rate to 19.75%, marking a sharp increase from the current 13% on mobile sports betting and 15% on internet casino gaming.
While this compromise fell short of Governor Phil Murphy’s initially proposed 25% rate, the industry impact may be just as disruptive.
And now, the question no one wants to answer out loud: Which sportsbook pulls the plug next?
Increasing Tax Rate Decreases Competition
The tax hike hasn’t yet sent shockwaves across the market. But it soon might, as legal sports betting sites will be forced to reassess the cost of staying competitive in what may no longer be a friendly business environment.
The sportsbooks tethered to Caesars Atlantic City (betPARX) and Ocean Casino (Prime Sports) are clear candidates for belt-tightening or even exit.
Ocean Casino’s meager $235,429 is practically a rounding error in gross online sports revenue so far in 2025. A glaring red flag, it’s barely a blip compared to Resorts Digital’s $141 million (DraftKings, ESPN Bet) or the $186 million from Meadowlands (FanDuel).
Additionally, Monmouth Park’s $6.3 million haul year-to-date puts BetRivers long-term online viability in question under a significantly higher tax burden.
With the amount of money bet on sports in the US, specifically New Jersey, there are razor-thin margins for some bookies and sky-high customer acquisition costs. In short, these numbers hint at instability.
A Broader Industry Reckoning
Critics have long warned that steep tax hikes risk pushing customers back to offshore sites, where the state earns nothing. Others, like Joe Brennan Jr., point to the “cost of doing business” in New Jersey, ranked dead last in the nation, as a legitimate reason for sportsbooks to look elsewhere.
This is happening as states like Maryland, Illinois, Ohio, and Louisiana all raise their tax rates, too, forcing operators to make hard choices about where to double down and where to retreat.
Governor Murphy claims this compromise strikes a fair balance, calling it “competitive” and “fair to taxpayers.” But fairness only matters if the market survives and isn’t top-heavy.
In the meantime, watch the low-performing licenses closely. If the numbers don’t improve fast, New Jersey may soon see its first major casualty of the 19.75% era… and it might not be the last.
