Proposed Gambling Tax Raise in Michigan Fails as Bills Expire

Tax rates will stay the same for our best sports betting sites and real-money online casinos in Michigan.

As Jan. 1 ticked over, the deadline for bills to increase the gambling operator tax rate in Michigan expired, meaning the tax rate will stay the same for now. Michigan lawmakers proposed a new tiered system that would raise the gambling tax by 1%. Senators Sam Singh and Jeremy Moss' SB 1193 and 1194 would have impacted sports betting and casinos in Michigan if either passed. 

The legislation aimed to raise the original Michigan sports betting tax rate from 8.4% to 8.5%. Michigan online casino operators earning less than $4 million annually would see their tax rates increase from 20% to 21%. In comparison, those earning more than $12 million would expect a new tax rate of 29% (also a 1% rise). 

Michigan grossed $500 Million in revenue

The two bills expiring followed a successful year for Michigan gambling, including Michigan sports betting apps, which generated half a billion in gambling revenue. In a report released by the Michigan Gaming Control Board (MGCB), the board reported which funds were receiving critical contributions. The School Aid Fund was at the top of the list, receiving over $501 million to fund K-12 public classroom education. 

Next, $4 million of tax revenue was given to the First Responder Presumed Coverage Fund, $3 million went towards the Compulsive Gambling Prevention Fund, $3.7 million to the Agriculture Equine Industry Development Fund, and finally, $3.75 million went to the “Don’t Regret the Bet” marketing campaign. 

“As we look back on another successful year, I am proud of the significant impact the Michigan Gaming Control Board continues to have on our state and its residents,” MGCB Executive Director Henry Williams said. “From supporting education and first responders to tackling illegal gambling, the MGCB remains steadfast in its mission to protect consumers and enhance the public good.”

In addition, Michigan casino revenue was up 40.1% year-on-year for its November revenue, which was a 5.3% increase from October 2024. 

Leading operators against tax increase

In response to proposed bills by Michigan lawmakers, leading operators FanDuel, DraftKings, and BetMGM told SBC Americas that they had emailed users urging them to oppose the new legislation. 

FanDuel’s email told users they should voice their complaints by filling out a form on the Sports Betting Alliance website. All three operators are members of the SBA. Moreover, a Fanatics spokesperson also commented by email: “While we did not engage our customers directly on this issue, we support the advocacy efforts of the other member companies.”

In a similar move by Illinois lawmakers, SBA opposed the tax hike, which saw the state nearly triple the tax rate in its sports betting market, with the highest rate at 40%. 

Other gambling bills set to die

As the legislation received no action from lawmakers, the two bills had officially expired by Jan. 1.

It wasn't the only instance of bills expiring in the new year. Ohio sports betting, South Carolina, and Texas sports betting had legislation fail regarding gambling markets. Each state that was not gaining activity by lawmakers saw each of the respective propositions, and Michigan’s expired by the start of the new year.