New Jersey Governor Wants Tax Hike on Sportsbook Revenues

New Jersey Governor Phil Murphy’s 2026 fiscal year budget includes a tax hike on the state’s mobile sports betting and New Jersey online casinos, but the industry is already mobilizing against it.

Vice Taxes

In addition to proposing tax increases on cigarettes, alcohol and cannabis sales, the governor is also submitting a plan to raise taxes on sportsbook revenues. Should Governor Murphy be successful, mobile sportsbooks and iGaming operators would see their respective 13% and 15% tax rates raised to 25%, which is projected to generate an extra $402.4 million annually for the state’s tax coffers.

New Jersey sports bettors bet a record $12.4 billion in 2024, which yielded yearly revenues of $1.09 billion, up 8.7% from 2023. Both are state records, and so too was New Jersey’s iGaming revenue, which delivered a whopping $2.39 billion, an increase of 24% over the previous year.

“Though the budget I present to you today is the final budget of our administration, it is one that reflects our ongoing — and unrelenting — commitment to building a state that is stronger, fairer, and more prepared for the future,” Murphy said during his budget address at the Statehouse in Trenton last week. “With this proposal, we’re getting New Jersey’s budget back on the road toward balance so we can uphold our obligation to keep our fiscal house in the best shape possible,“ Murphy remarked.

Term limits prohibit Governor Murphy from running again. Therefore, lawmakers may not be as loyal to the lame duck governor as in years past, which could sink those plans for revenue increases. Critics have already noted that Murphy’s $58.1 billion budget is 67% higher than the budget enacted immediately before he took office in 2018.

Opposition Mobilizing

Industry advocates are calling to maintain the status quo, and that includes two lawmakers, Democratic state Senator John Burzichelli and Republican state Senator Michael Testa, Jr., who issued a joint statement on the governor’s proposed tax increases.

 “Doubling the tax on online sports betting and iGaming is putting a New Jersey success story at significant risk. A tax increase would negatively impact jobs, industry investment, and our New Jersey customers, and it could affect future revenue growth for the state.”

It took less than 24 hours after Governor Murphy unveiled his budget proposal for online gaming giant FanDuel to mount its opposition to the tax increase. The company sent the following email to its customers.

“We NEED your HELP! New Jersey just announced a tax hike on online betting — both sports betting and iGaming. If approved, it would result in a nearly 100% tax increase! With massive, unfair tax hikes like this, everyone loses.

“Why does it matter? A tax hike will have a MAJOR impact on your favorite online games, putting promotional offers and the best odds at risk.

“Click ‘TAKE ACTION!’ to send a personal message to your representatives in Trenton to SAY NO TO AN UNFAIR TAX HIKE!“

Negotiations are certain to follow, and many industry insiders believe a tax hike to 20% may be the happy medium that will assuage the concerns of all parties involved.

Bookmakers Review will continue to monitor this story and update our readers as events unfold.