North Carolina Raises Online Sports Betting Tax From 18% to 23%
Key Takeaways:
- Gov. Stein signed a budget that raises North Carolina's online sports betting tax from 18% to 23%.
- The budget also revises how betting tax revenue is allocated to public universities, adding UNC-Chapel Hill and NC State to the distribution list starting in 2027.
- The hike is the first increase since the market's March 2024 launch, which moves North Carolina above states like Massachusetts and Ohio.
North Carolina sportsbooks are now paying a higher price to operate in the state after Gov. Josh Stein signed the fiscal 2025-26 budget into law, raising the tax on online sports betting revenue from 18% to 23%.
North Carolina Senate Bill 257: The Details
Senate Bill 257 increases the levy on gross wagering revenue collected by the state's licensed online sportsbooks, effective immediately upon signing. It's the first tax increase since North Carolina's online sports betting market launched in March 2024, and it applies to the seven online operators currently licensed in the state.
"After careful deliberation, this morning I will sign the state budget into law," Stein said.
State senators originally floated a jump to 36% in April 2025, a rate that would have placed North Carolina among the five states with the highest sports betting tax rates in the country. That proposal stalled, and lawmakers eventually settled on the middle-ground 23% figure.
The budget cleared the House 88-21 and the Senate 35-10 before reaching the governor's desk.
At 23%, North Carolina's rate is above those of other major markets, including Massachusetts, Ohio, and New Jersey, though it remains well below New York's 51%, currently the highest flat rate in the country.
UNC, NC State to Benefit from Tax Increase
The budget changes how sports betting tax revenue gets distributed to North Carolina's public universities.
Notably, UNC-Chapel Hill and NC State, the state's two largest schools by enrollment, will become eligible for a share of proceeds for the first time starting in July 2027, joining other UNC System schools that already receive annual payments. Those payments are initially capped per institution, with additional carve-outs written into the bill for specific programs.
Since launch, North Carolina sportsbooks have generated more than $300 million in tax revenue under the old 18% rate.
What This Means for NC Bettors
The tax increase applies to operators, not directly to individual wagers, so you won't see a line-item change on your bet slips.
However, tax hikes of this size tend to affect promotions and bonus bets over time, as operators recalibrate their offers in response to the higher cost of doing business.
