Billions in tax revenue would be generated by expanding sports betting legalization
Billions of tax revenue would be generated if all 50 states in the US made sports betting legal, a report by the Tax Foundation claims.
If all states established statewide gambling markets, the Tax Foundation estimates that gross gaming revenue (GGR) would increase by $15.6 billion per year.
If all 50 states established legal, open, statewide sports gaming markets, a 10 percent GGR tax would generate an additional $1.6 billion per year in tax revenue.
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— Tax Foundation (@TaxFoundation) January 22, 2026
This figure is more than double what is being reported right now, and legal sports betting in all states would generate $1.6 billion annually in tax revenue, assuming a 10% GGR tax.
Despite most states legalizing sports wagering in some form, only 30 states allow bettors to utilize online betting platforms.
Should legalization occur in all states, the biggest tax revenue gains would occur in California ($570 million), Texas ($326 million) and Florida ($199 million), which would contribute significantly to the economy.
Could we see sports betting legalized in all states in the future?
Missouri has become the latest state to legalize sports betting, with the first state-regulated sportsbooks going live towards the end of last year.
That now leaves 11 states where sports betting is not legal: South Carolina, Hawaii, Georgia, Alabama, Alaska, California, Texas, Oklahoma, Minnesota, Utah and Idaho.
While California and Texas would be the two biggest generators of tax revenue should legalized sports betting be introduced, some of the smaller states would still generate millions.
Hawaii, for example, would generate $11 million per year in tax revenue, despite a small population of adults within the state.
Idaho also has a smaller population of adults compared to other states, yet it would likely generate around $13 million per year in tax revenue.
Even Alaska, with a third of the population confined to rural areas, would be able to generate $6 million in tax revenue, despite the state having no professional sports teams in the state.
Of those 11 states, only Georgia has an active legislature regarding the legalization of sports betting, suggesting there is plenty of work to do to ensure all 50 states could benefit from the extra tax revenue.
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