The regulated gambling industry in the United States faces new challenges as several states implement bans and tax increases, impacting both online and retail sectors.
Key Takeaways:
- Louisiana and Connecticut advance legislation to ban sweepstakes casinos
- Illinois introduces new tax hikes on sports betting operators
- Ontario’s iGaming revenue shows significant growth, reaching CA$313.2 million in April
Sweepstakes Casino Bans Gain Momentum
Louisiana is on the verge of becoming the second U.S. state to outlaw sweepstakes casinos. The state senate approved SB 181 on June 4, which now awaits Governor Jeff Landry’s signature. The bill imposes severe penalties, including up to five years in prison and fines of up to US$100,000 for violators.
Connecticut is following suit with SB 1235, which prohibits sweepstakes tied to simulated gambling, online casinos, or sports betting. Violations will be classified as a Class A misdemeanor, carrying potential jail time and fines.
Illinois Raises the Stakes with New Taxes
In a move criticized by industry stakeholders, Illinois lawmakers have introduced new tax hikes targeting the sports betting sector. Operators will face a levy of 25 cents per wager on the first 20 million bets, doubling to 50 cents thereafter. This increase comes on top of last year’s tax rate hike, which raised rates from 15% to as high as 40% depending on revenue.
The Sports Betting Alliance (SBA) has voiced strong opposition to the measure, arguing it could have a “devastating impact” on the industry. Critics suggest the tax hike may inadvertently push bettors towards illegal markets.
Governor JB Pritzker defended the decision, stating, “The Trump slump is affecting every state. And the chaos and uncertainty of the Republicans’ proposed cuts to health care and education and jobs have made budgeting harder than ever before.”
Arizona Targets Prediction Markets
Arizona has joined the growing list of states taking action against prediction markets. Arizona Department of Gaming director Jackie Johnson has urged the Commodity Futures Trading Commission to restrict operations of platforms like Kalshi, Robinhood, and Crypto.com. Johnson argues that “contracts” on sporting outcomes violate Arizona’s 2020 Gaming Act.
Ontario’s iGaming Sector Thrives
In contrast to the regulatory challenges in the U.S., Ontario’s iGaming market continues to flourish. The province reported a 25.3% year-on-year increase in gambling revenue for April, totaling CA$313.2 million. Casino gaming led the growth, accounting for 78% of the total at CA$242.8 million, while sports betting revenue remained stable at CA$64.5 million.
The success of Ontario’s regulated online gambling market has sparked speculation about which Canadian province might be next to embrace iGaming. Industry observers suggest Quebec as a likely candidate, with oil-rich Alberta already set to launch its market in late 2025 or early 2026.
As the North American iGaming landscape continues to evolve, operators and stakeholders must navigate an increasingly complex regulatory environment. The contrasting approaches of U.S. states and Canadian provinces highlight the diverse challenges and opportunities within the industry.
