New Jersey legislators have approved significant gambling reforms, including a new tax structure for online betting and a ban on sweepstakes casinos. The measures, passed on June 30th, await Governor Phil Murphy’s signature before becoming law.
The new regulations set a flat 19.75% tax rate for online gambling businesses, covering sports betting sites, internet casinos and daily fantasy sports (DFS) companies. Previously, these businesses were taxed between 10.5% and 15%, depending on the type of gambling offered.
Governor Murphy initially proposed raising taxes to 25%, but industry pushback led to a compromise rate, aligning New Jersey with states like Maryland and Louisiana, which have also increased taxes on mobile sports betting.
Lawmakers also passed Bill A5447, targeting sweepstakes casinos operating in legal grey areas. These platforms are now categorised as unlicensed gambling, with repeat offenders facing fines up to $250,000. Proponents of the ban argue these platforms lack sufficient oversight and consumer protection. However, the Social & Promotional Games Association (SPGA) opposes the Bill, urging the Governor to veto it, claiming these platforms comply with existing laws and offer valuable choices for players.
Bill A5447 also introduces criminal penalties to ensure fair betting practices, making it illegal to place bets using someone else’s account or to bet on behalf of another when stakes are high.
Critics, including Joe Brennan Jr. from Prime Sportsbook, express concerns about the Bill’s vague language, fearing it could inadvertently criminalize public sports discussions or sharing tips.
Supported by the state’s Council on Compulsive Gambling, these new laws reflect New Jersey’s commitment to responsible gambling regulation, striving to be a model for other states.
