More than $5.5 billion was wagered by North Carolinians during the first year of legalized online sports betting in the state. As the first anniversary of legalized online sports betting has passed, an analysis of the numbers is timely, considering that this is the first time online bets on the Super Bowl have been legal in the state.
The numbers for the first year in sports betting are accounted for across two fiscal years: the end of FY24 and the beginning of FY25.
The amount paid out as winnings and gross wagering revenue are two focal points. Gross wagering revenue is the total amount an interactive sports wagering operator (i.e., Draft Kings) receives from sports wagers as authorized under state law. The gross revenue is the amount paid minus any winnings before deductions, expenses, fees, and taxes, according to the North Carolina State Lottery Commission.
March through June of FY24 totaled $1.9 billion in winnings paid to North Carolinians and more than $275 million in gross wagering tax revenue. April was the biggest month of FY24, with more than $538 million in paid winnings and more than $105 million in gross revenue.
FY25 totaled more than $3.4 billion in winnings paid out and $383 million in gross revenue from July through January. The biggest month of FY25 so far was not January in the lead-up to the Super Bowl, as one might think, but November.
November totaled $638 million in winnings paid out and more than $78 million in gross revenue. January easily took second place with $568 million paid out and $74.5 million in gross tax revenue.
The tax revenue generated is 18% of the gross wagering revenue, as dictated by statute. During FY24, the state collected more than $49.5 million in tax revenue from online sports betting, including $18.9 million in April, the biggest month of FY24. Tax revenue totaled $68.9 million in FY25. November, the most significant month so far of FY25, resulted in more than $14 million in tax revenue, with January coming in with more than $13.4 million.
“During the first seven months of FY 2024-25, sports betting in North Carolina has generated an estimated $68.9 million in tax revenue for the state,” Joseph Harris, fiscal policy analyst for the John Locke Foundation, told the Carolina Journal. “This estimate easily exceeds the projected total of $36.1 million for FY 2024-25 that was made in the 2023 biennial budget.”
State law requires 20% of the tax revenue to be distributed evenly among 13 state universities and is used to support the collegiate athletic departments. North Carolina taxes sports betting at 18%, the 11th highest tax rate of those states that allow online gambling. As previously reported by the Carolina Journal, $98.6 million in tax revenue was collected between March and Nov of 2024. Of that $98.6 million, 20% or $17.3 million was distributed among the 13 North Carolina public universities.
“Currently, the total revenue collected from sports betting is on track to eclipse $118 million by the end of the fiscal year,” concluded Harris. “However, it is worth noting that the months of February, March, April, and May have the potential to generate revenue above the monthly average due to the Super Bowl, March Madness, and the NBA playoffs. In fact, last April produced the most tax revenue for the state in a single month, or $18.9 million, from sports betting since its inception last March.”