Massachusetts operators could pay 51% tax on sports betting

• Senator John Keenan files legislation to raise the Massachusetts sports betting tax from 20% to 51%.
• The proposed bill would ban in-play and proposition bets and implement daily wagering limits of $1,000.
• Affordability checks would restrict monthly betting to 15% of a bettor’s bank account balance.

Massachusetts lawmakers are considering sweeping changes to the state’s sports betting regulations through a controversial bill that would more than double tax rates and introduce strict financial safeguards for bettors.

Senate Bill 302, formally titled “An Act Addressing Economic, Health and Social Harms Caused by Sports Betting”, was filed on 16 January 2025 as Senate Docket No. 1657 by Senator John F. Keenan (D-Norfolk and Plymouth), along with Representative Lindsay N. Sabadosa and Senator Patricia D. Jehlen.

The proposal represents one of the most restrictive sports betting regulatory frameworks in the United States.

Tax increase and betting restrictions

The bill’s centrepiece is a proposed tax rate increase from the current 20% to 51% on online sports betting revenue.

This would place Massachusetts alongside New York, New Hampshire and Rhode Island, which currently impose the nation’s highest sports betting taxes at 51%.

Keenan previously attempted a similar tax increase in May 2024 through Amendment 828 to the state budget bill, but the proposal was quickly dismissed by the Senate. Massachusetts collected approximately $213.5 million in total taxes from sports wagering since launching in January 2023.

The legislation would eliminate two popular betting categories: in-play wagers and proposition bets. Currently, Massachusetts permits in-play betting but already restricts prop bets on collegiate athletes. The new restrictions would further limit betting options to traditional pregame wagers only.

Affordability checks and spending limits

Senate Bill 302 introduces mandatory affordability checks for bettors who exceed $1,000 in daily wagers or $10,000 in monthly wagers. These assessments would require operators to verify that total monthly betting does not exceed 15% of a bettor’s available bank account balance.

Massachusetts would become the first US state to mandate affordability checks if the bill passes. The proposal mirrors provisions in the federal Supporting Affordability and Fairness with Every Bet (SAFE Bet) Act, introduced by Representative Paul Tonko and Senator Richard Blumenthal in September 2024.

The Massachusetts Gaming Commission reported that online sportsbooks in the state accepted $764 million in wagers in November 2024, generating $79.5 million in taxable gaming revenue. The commission collected a monthly record $16 million in tax revenue under the current 20% rate.

Advertising and compensation restrictions

The bill would ban sports betting advertisements during televised sporting events, addressing concerns about gambling normalisation during high-profile broadcasts. This provision echoes earlier discussions by the Massachusetts Gaming Commission, which ultimately determined such restrictions would be difficult to enforce for nationally televised events.

VIP programmes would face restrictions under the proposal. The bill prohibits operators, directors, officers, employees, affiliates and subcontractors from receiving compensation tied to a percentage of customer wagers or deposits. This would effectively eliminate commission-based pay structures for VIP hosts at major sportsbooks.

The legislation also increases the annual licensing fee for online betting operators to $2 million, double the current $1 million requirement. Additionally, operators would be required to increase their contributions to problem gambling initiatives from $1 million to $2 million annually.

Public health focus and industry pushback

Keenan has framed the legislation as a public health measure. At a November 2024 legislative hearing, he drew comparisons between gambling addiction and the opioid crisis.

“When I voted to legalise sports betting, I never thought it would become what it is,” Keenan said during the hearing.

He later expressed that he “deeply regrets” his role in legalising online sports betting in Massachusetts.

The Sports Betting Alliance, representing major operators including DraftKings, FanDuel and BetMGM, has opposed the bill. Industry representatives argue that Massachusetts already maintains stricter regulations than most states and that the proposed changes could drive bettors towards unlicensed offshore platforms.

The bill has been referred to the Joint Committee on Economic Development and Emerging Technologies. Lawmakers extended the committee’s reporting deadline to 6 March 2026, allowing additional time for review and public hearings.

Market implications

Massachusetts launched legal sports betting in January 2023 for retail wagers and March 2023 for online betting. The state has consistently ranked among the most restrictive sports betting jurisdictions in the country.

Current regulations already ban betting on in-state college teams except during tournaments, prohibit credit card deposits and require extensive vetting of operators. Licensed operators in Massachusetts include DraftKings, FanDuel, BetMGM, Caesars and Fanatics.

If enacted, the combined impact of tax increases, betting restrictions and affordability checks would fundamentally alter the economics of sports betting in Massachusetts. Industry analysts suggest the changes could reduce promotional spending, limit market growth and potentially encourage consolidation among smaller operators unable to sustain operations under the new framework.

The Public Health Advocacy Institute, which also supported the federal SAFE Bet Act, has backed Keenan’s legislation. The proposal includes provisions requiring operators to share anonymised data with researchers studying gambling addiction and potential links to suicide attempts and self-harm.

Massachusetts operates under a two-year legislative session, meaning Senate Bill 302 must pass both chambers and receive approval from Governor Maura Healey before January 2027 to become law. The governor has not commented on the specific proposal but supported the original sports betting legislation passed in August 2022.