(The Center Square) – Ten sportsbooks have been approved to do business in Massachusetts on Friday when mobile sports wagering opens.
The state stands to rake in revenue as Catena Media, who runs the website PlayMA.com, has released a study illustrating how the Bay State could net $87 million in tax revenue generated from an industry that is forecast for $5.7 billion in annual revenue.
“We believe there is a very real chance Massachusetts reaches $87 million in sports betting revenue – which is significantly more than the $60 million state lawmakers projected,” Eric Ramsey, market analyst for PlayMA, said in a statement. “Of course, there’s still a big domino to fall: How will the Massachusetts Gaming Commission handle promotional write-offs?”
While Massachusetts is already offering in-person sports betting at its three casinos, the 10 sportsbooks are prepared to accept wagers under Senate Bill 269, which then-Gov. Charlie Baker signed into law on Aug. 10. The law permits the state's three casinos, live horse racing venues, and online sports books to accept wagers.
The sportsbooks will begin accepting wagers at 10 a.m. Friday. The launch comes just prior to tipoff of the annual NCAA men’s basketball tournament.
Massachusetts, under the law, will impose a 20% excise tax on each casino’s adjusted gross sports wagering receipts under category 1 and 2 licenses. The state will then collect a 25% excise tax on category 3 licenses, under the law. In addition, operators of fantasy contests will face a 25% excise tax on gross wagering receipts.
The bill calls for 5% of revenue from online sports wagering to be placed into the public health trust fund and will be used for social service and public health programs aimed at problem gambling issues, sports gambling prevention and addiction services, substance abuse services, and educational campaigns.
The remaining funds, according to the law, will then be placed into the state’s general fund.
Jason Robins, co-founder of DraftKings and its chief executive officer and chairman, said the launch in Massachusetts serves as a high point for the company.
“It was just over 10 years ago when we launched DraftKings from a spare bedroom in Watertown, and now, we are proud to have the opportunity to deliver a safe and legal sports betting product to millions of diehard sports fans across Massachusetts,” Robins said in a statement. “This launch will make a major milestone for our company, and we’re proud to become the hometown sportsbook for customers in the commonwealth.”
