A recently sponsored sports betting reform bill would inextricably alter the mobile sports betting landscape in Massachusetts and could be its death knell should the measure pass.
Seismic Changes
State Senator John Keenan is the architect of SD 1657, a sports betting reform bill that is undeniably one of the most radical bills to ever appear in a state that has successfully launched mobile sports betting. It not only raises the tax rate to a national high that ties New York’s 51%, but also outlaws in-game betting, same-game parlays and several other staples of the industry.
Below are the highlights of SD 1657:
- Increase Massachusetts’ sports betting tax rate to 51%.
- Ban sports betting ads during televised sporting events.
- Ban live betting.
- Ban prop betting.
- Consider bonuses and same-game parlays as unfair and deceptive practices.
- Establish affordability checks for gamblers and limit betting activity to 15% of the customer’s bank account.
- Ban any type of compensation based on a customer’s gambling activity (bonuses).
- Establish betting limits of $1,000 per day and $10,000 per month maximum.
The current tax rate in Massachusetts is 15% on retail sportsbooks and 20% on mobile sportsbooks’ adjusted gross revenues. Massachusetts sportsbooks sent $129.1 million to the state’s tax coffers in 2024, and that number is expected to grow this year.
Under Keenan’s proposal, the tax rate would skyrocket to 51%, live betting, prop betting and bonuses would be banned, and universal betting maximums would be placed on bettors regardless of their financial wherewithal.
End Game Objective
Senator Keenan’s bill is so radical that some are questioning his true intentions. His supporters believe that if his bill passes, the dramatic changes caused because of it would be for the greater societal good without harming the Bay State’s burgeoning mobile sports betting industry. Critics point out that people would stop betting with licensed sportsbooks and look elsewhere, effectively ending the era of prosperity the industry has thus far enjoyed in Massachusetts.
Yet, there are some who cannot fathom that a seasoned politician like Keenan would advance an agenda this transformative and expect it to pass muster with his colleagues, who have labored tirelessly on crafting rules that have worked well since sports betting launched in March 2023.
Those skeptics believe the end game is ultimately getting the legislature to raise the sports betting tax, with everything else simply window-dressing to effectuate that result. Industry lobbyists would then view any tax increase less than the onerous and unreasonable 51% proposed in Keenan’s bill as a victory, which would also include eliminating all the other flotsam and jetsam in his bill.
Matthew Chaprales, a senior advisor to GMA Consulting, noted that the tax hike portion of Keenan’s bill is similar to discussions currently underway in legislatures across the nation regarding tax increases on sports betting revenue.
“It stands to reason he’s ultimately trying to arrive at a real discussion of tax structure,” Chaprales said. “Which would square with what has certainly been a bigger focus throughout other state legislatures over the past 12-18 months.”
Overreaching Legislation
According to Chaprales, 51% is unrealistic because “Massachusetts ain’t New York,” noting the latter is the fourth most populated state in the nation with 20.2 million residents, nearly three times that of Massachusetts. But getting people talking about the bill could lead to a 30% or 35% tax, which would likely be considered a big win for Keenan.
But sports betting consultant Dustin Gouker says the concerning aspect of Keenan’s legislation is that some of the radical proposals within it could gain traction and ultimately cripple an industry that has been a roaring success since it was launched two years ago.
“The danger and the angle of the legislation is to get more momentum for anything in this bill, not necessarily all of it,” Gouker said. “[The danger] is in spreading the various ideas of the bill and getting adoption elsewhere that would chip away at the ability of regulated sportsbooks to do business.
“Not all of the stuff in this bill is bad policy, but most of it is.”
