New Jersey Governor Signs Bill Raising Online Sports Betting Tax

Under the new bill, Daily Fantasy Sports will now be taxed almost twice as much as the previous rate.

Ziv Chen

Last Updated: July 3, 2025 2:03 PM EDT • 2 minute read

New Jersey Governor Signs Bill Raising Online Sports Betting Tax — Pictured: Gov. Phil Murphy. Photo by Kevin R. Wexler/NorthJersey.com / USA TODAY NETWORK via Imagn Images.

New Jersey has officially raised its taxation on online casinos, Daily Fantasy Sports (DFS), and sports betting. Governor Phil Murphy signed the new legislation on Monday afternoon, increasing the Garden State’s online gambling tax rate to 19.75%.

New Jersey online casinos were previously taxed at a 15% rate on revenue, sports betting at a 13% rate, and DFS at a 10.5% rate. Under the new bill, Daily Fantasy Sports, the smallest revenue generator of the three, will now be taxed almost twice as much.

Before the governor signed the bill, New Jersey was among the states with the lowest tax rates in the US, especially compared to New York’s 51% tax rate on sports betting, Delaware’s 50%, and Pennsylvania’s 36% tax rate on betting. It's about to be a significant change to the bottom line for New Jersey sp orts betting apps.

Tax rethink during forecasted industry growth

The major tax rethink surrounding online gambling in New Jersey results from the industry's expansion. Online technologies have played a significant role in the industry’s growth, with the North American online gambling market expected to reach $32.95 billion by 2030, representing nearly 78% growth from its current market size.

This massive growth reflects a broader trend of increasing customer demand, and states like New Jersey are adjusting their tax policies to balance generating revenue for public services while remaining competitive to attract both operators and their customers.

Other changes to the New Jersey gambling market

Despite the promising growth of the entire online gambling industry, the New Jersey gambling market faces challenges other than increased taxation. Senator Kristin M. Corrado proposed a bill that prevents New Jersey sportsbooks from accepting wagers on prop bets involving college teams across all sports.

The primary purpose of this particular bill is to protect the growing number of abuses that college athletes face from disgruntled bettors on social media. Those opposing the bill have stated that the authorities should focus on abusers, rather than making roundabout rules that only try to reduce the abuse.

College athlete abuse isn’t the only issue, because the markets also tempt college players into betting on college or pro sports, which the NCAA strictly prohibits. However, that may also change soon with the NCAA considering allowing college athletes to bet on professional sports.

The new prop ban in New Jersey may reduce the impact of betting on college and basketball matches, but the problem goes far beyond the NCAA in New Jersey.

Written by:
Ziv Chen

Ziv has over two decades of experience in the igaming and sports betting industry, having served in senior marketing and business development positions with both B2C and B2B companies, including Playtech and Microgaming. In 2019, Ziv decided to pursue his passion for writing and became a fulltime industry journalist, covering casino, sports, and gambling business news. He’s specialties include casino games and technology, US state gambling regulation, company performance, as well as gambling affiliates and marketing. As a Pitt graduate, Ziv is a diehard fan of all Pittsburgh sports teams, with the Steelers at the top of the list. In his free time, he enjoys reading crime fiction, biographies (mainly of sports personalities, but not only) and American history. Ziv’s Favorite quote: “We're going to pursue perfection, knowing full well we won't catch it, but we're going to relentlessly chase it," Mike Tomlin, Pittsburgh Steelers Head Coach.