North Carolina Lawmakers to Raise Sports Betting Tax on Operators

North Carolina lawmakers looking to raise the state’s sports betting tax rate, while two large universities will receive a cut of tax revenues

Ziv Chen

Last Updated: June 9, 2026 5:47 AM EDT • 3 minute read

Pictured: Carolina Hurricanes defenseman Sean Walker passes the puck as we look at North Carolina raising its sports betting taxes. Photo by Stephen R. Sylvanie-Imagn Images

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North Carolina legislators have agreed to raise the state's sports betting tax rate, with both chambers settling on a figure at the lower end of a range that sources say fell between 20% and 30%. The agreement was confirmed by House budget writer Donny Lambeth, though he declined to name a specific number. Sources told local media outlet WRAL that the figure landed closer to 20%.

The state currently collects 18% of gross wagering revenue from the eight licensed North Carolina sports betting apps, a structure that has generated over $287 million in tax revenue since online sports betting launched in March 2024, well ahead of initial budget projections. Bettors have placed upward of $15.3 billion in total wagers since the program began.

The Sports Betting Alliance has opposed any increase and warned that higher rates could mean worse odds and fewer promotional offers for bettors. The group also cautioned that customers could move toward illegal markets if the legal North Carolina sports betting product becomes less attractive.

As part of the broader budget talks, lawmakers also agreed to two more of its universities, UNC-Chapel Hill and NC State begin receiving a cut of the tax revenue. The 13 other UNC System schools with athletic programs have already been collecting tax revenues since the program began.

Illinois moves to tax prediction markets and formalize DFS

North Carolina is not alone in reworking how it taxes gambling activity. The fiscal year 2027 budget in Illinois includes a new tax on sports-event contracts offered on prediction market apps. This is coupled with new licensing guidelines for daily fantasy sports (DFS).

The measure, Senate Bill 3019, amends the state's Sports Wagering Act to recognize "exchange wagers" as a distinct bet type alongside existing categories, such as moneyline and point spread bets. The initial tax on those contracts is set at 1.75% per transaction, rising to 3.5% for any licensee that exceeds 5 million transactions in a fiscal year. The structure is tied to transaction volume and not to gross revenue.

The new law arrives in the middle of an active federal court dispute. The Commodity Futures Trading Commission sued Illinois in April, arguing the state was attempting to regulate markets that fall under federal jurisdiction.

Regulators that oversee Illinois sports betting have recently tightened measures against prediction markets, including issuing cease-and-desist letters to prediction market operators. In turn, several filed against the state.

On the DFS side, the budget creates two licensing tiers under the Illinois Gaming Board. Operators serving 7,500 or fewer guests pay a $500 license fee, while those with larger audiences pay $7,500. Both tiers owe a 15% tax on adjusted gross receipts from fantasy contests and receive two-year licenses.

A separate proposal from Governor J.B. Pritzker to align casino table-game tax rates with those applied to slot machines was not included in the final package.

Written by:
Ziv Chen

Ziv has over two decades of experience in the igaming and sports betting industry, having served in senior marketing and business development positions with both B2C and B2B companies, including Playtech and Microgaming. In 2019, Ziv decided to pursue his passion for writing and became a fulltime industry journalist, covering casino, sports, and gambling business news. He’s specialties include casino games and technology, US state gambling regulation, company performance, as well as gambling affiliates and marketing. As a Pitt graduate, Ziv is a diehard fan of all Pittsburgh sports teams, with the Steelers at the top of the list. In his free time, he enjoys reading crime fiction, biographies (mainly of sports personalities, but not only) and American history. Ziv’s Favorite quote: “We're going to pursue perfection, knowing full well we won't catch it, but we're going to relentlessly chase it," Mike Tomlin, Pittsburgh Steelers Head Coach.