Virginia Gov. Glenn Youngkin sports betting legislative change.
mobile sports betting operators to exclude bonuses or promotions from their tax obligation. This helped major sportsbook operators limit taxes paid to Virginia, reducing the potential tax revenue brought to the state by millions. Through March, only five of the 12 operators in the state paid taxes, according to the Richmond Times-Dispatch.
A state budget amendment changes the promotional deduction rule, prohibiting sports betting operators “from excluding bonuses or promotions used to encourage betting from their adjusted gross revenue 12 months after they begin sports betting activity in Virginia.” The change gives operators a year to take advantage of the tax break related to using free bets and other promotions to engage the Virginia customer base.
As one state taketh away (Virginia), one state giveth (North Carolina) #SportsBetting https://t.co/mCTJ8AC4Wx
— Chris Altruda (@AlTruda73) June 21, 2022
Major operators like FanDuel have been in operation in Virginia for over a year, which means their days of enjoying the tax deduction are numbered. The rule goes into effect with the rest of the budget on July 1, and the budget will remain in effect for two years.
free bets and promotions when available.
Good for Virginia? 3z5x37
The change should bring increased tax revenue to Virginia, although the move also means Virginia bettors will likely see fewer frequent promotional offers from the state’s major operators. Del. Mark Sickles pushed for the tax change during the state’s legislative session, but his bill stalled out. He was able to push the change forward through a state budget amendment.
“I consider this a technical correction,” Sickles told the Virginia Mercury.
It’s a change that makes sense for the Commonwealth from a tax perspective, as additional money will head to the state’s general fund. Virginia taxes sports betting adjusted gross revenue at 15%, and of the tax revenue generated from sports wagering, 97.5% goes to the state’s general fund. The remaining 2.5% is distributed to the Problem Gambling Treatment and Fund istered by the Virginia Department of Behavioral Health.
