Virginia Nearly Sets a New Sports Betting Handle Record for December
The Virginia Lottery released its sports betting report to close out its first year of entering the industry. The handle exceeded $400 million for the third consecutive month, nearly topping the record. However, operators saw a decline in revenue due to the user-friendly results for the month.
Taking a Look at Virginia Sports Betting Handle for December
Sportsbook operators brought in a combined total of $426.6 million in wagers for the month, noting an increase of six percent from the previous month. The state’s record was set back in October, showing a handle of $427.3 million, which is not even a one percent difference.Sportsbook operators in Virginia took in $426.6 million in wagers for December.
The numbers are significant as they show why Virginia is a prime destination for sports betting in the industry. Many other states in the industry hit all-time highs in October because five weekends were inserted into the report instead of the traditional four.
This meant October’s handle factored in an extra weekend of NFL and college football betting. As of this moment, only nine of the 23 jurisdictions that released their sports betting handles saw growth to end 2021.
The reason is December had a very limited college football schedule and the cancellations of a few games across several leagues. Despite having a limited schedule, December now stands as the second-highest month in the state’s average betting volume since it all began in January.
Bettors across the state wagered an average of $13.7 million per day. However, sportsbook operators couldn’t capitalize entirely as the results favored the consumers.
Virginia’s Tax Code on Sportsbook Operators Could Undergo a Few Changes
Sportsbook operators accumulated $285 million in their first year of operation in Virginia. However, under the state’s current tax laws, only 54 percent or $155 million of that went untaxed. Sportsbook operators are permitted to deduct from their taxable revenue as they use risk-free promotional bets to get consumers to use their platform.
According to the Tax Foundation, this has reduced Virginia’s tax rate from 15 percent to an effective 5.14 percent and limits the number of funds that could go to organizations that need it like the state’s general tax fund and Problem Gambling Treatment and Support Fund.
Bill HB 1103 would limit this deduction approach to only the first year of operation. The bill would also prevent sportsbook operators from carrying over losses month-to-month.
For December, online providers reported gross sports betting revenue of $31.5 million, but taxes only made up one-third of the total. Sportsbooks were able to write off a total of $17.1 million due to promotions and $4.3 million in other deductions.
The taxable revenue dropped to $10.1 million, and only four of 11 operators paid taxes, totaling $1.7 million.
FanDuel Sportsbook walked away with the most significant market share that hit 42.7 percent from launch through November. DraftKings secured the second position with a market share of 26.8 percent. SI Sportsbook and Betway are also expected to launch in the first quarter of 2022.