Credit for legalised sports betting in the United States runs through New Jersey. The state sued the federal government for that right, won at the Supreme Court in 2018, and launched within weeks. Every state that has opened a sports betting market since has built on what New Jersey proved. The operating model, the licensing framework, the relationship between online operators and state regulators: New Jersey figured it out first.
Then New York launched mobile sports betting in January 2022 with a different philosophy entirely. Within months it had overtaken New Jersey in total wagering. By the end of 2025 it was handling more than twice as much. The numbers from each are worth sitting with.
Two Models, Both Producing Results Worth Knowing
New York took the revenue-maximising approach. Its 51% tax on gross gaming revenue is the highest rate in the country, applied across nine licensed online operators. The consequence is that operators in New York have less margin to fund promotions than in more competitive markets.
We found wsn.com/bonuses/new-york listing bonus offers specifically available to New York bettors and this reflects a market where the tax rate shapes what operators can afford to put on the table. The market itself, however, is enormous: New York handled more than $26 billion in wagers in 2025, roughly 16% of all US sports betting handle, and generated $1.3 billion in state tax revenue, accounting for 36% of every sports betting dollar collected by any state that year.
That tax revenue funds specific public programmes. New York allocates it to education, youth sports, and problem gambling treatment, with $6 million ring-fenced annually for problem gambling services specifically. The 51% rate drew operator criticism, and DraftKings briefly proposed a surcharge on winning bets in high-tax states before dropping the idea.
The Per-Capita Argument Runs Through New Jersey
Princeton sits inside New Jersey’s sports betting market, and local coverage of the economy has tracked how the operator-friendly model plays out in practice. New Jersey launched at 13% on online sports betting gross revenue and opened the market to 13 licensed sportsbooks, giving bettors more competition, more promotional offers, and more options than New York’s tighter operator roster.
The result shows up in the per-capita data: New Jersey bettors wagered an average of $1,352 per resident in 2024, compared to $1,140 in New York. The smaller state produced a comparably engaged betting public, and the more competitive market was part of why.
That gap did not last unchanged. New Jersey raised its online sports betting tax to 19.75%, plus a standing 1.25% investment levy bringing the effective rate close to 21%, on July 1, 2025, as part of its FY2026 budget. The move roughly doubled the state’s monthly tax take from sports betting.
In May 2026, New Jersey collected a record $18 million in taxes despite handle falling to $912.9 million, down from $1.01 billion in the same month a year earlier. The state’s revenue from the industry rose even as the industry itself ran a little quieter. New Jersey has moved into the company of the higher-tax states, though it remains well short of New York’s 51%.
Both States Have Made the Numbers Work
The Tax Foundation, which tracks state sports betting tax policy nationally, has noted that lower-rate states like New Jersey created conditions for competitive pricing and promotional activity that higher-rate states tend to constrain. That dynamic produced New Jersey’s per-capita engagement advantage. Higher tax rates generate more public revenue per dollar of activity but leave less margin for operator promotions. Neither state holds the monopoly on the better outcome.
New York built the biggest market by volume. New Jersey built something more competitive per bettor, where operators fought harder for customers because the tax environment left room to offer better terms. The 2025 tax increase has narrowed that distinction, but the data from both markets still reflects the original design choice.
The sports betting rivalry between these two states is not one that produces a clear winner. It produces a clear lesson: different tax philosophies applied to the same product in the same metro area generate genuinely different markets.
New York’s bettors fund state education at a rate their counterparts in New Jersey do not. New Jersey’s bettors have historically had better promotional access because operators could afford to offer it. New Jersey’s move upward has made the comparison between them significantly more interesting to track.
The Daily Princetonian’s editorial staff do not edit or otherwise review sponsored content.
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