The Arizona Department of Gaming has released the second draft of its sports betting rules and regulations which includes adjustments to sports wagering taxation that will benefit sportsbooks operating in the state. While there is still a chance that these rules could be changed again, Arizona is on track to have one of the lowest tax rates in the U.S. sports betting industry.
According to the new set of rules, retail and online sports betting revenue will be taxed at different rates, which is the case in most states throughout the U.S: retail sports betting betting revenue will be taxed at a rate of 8%, and online sports betting will see a 10% tax.
Also included in the new set of rules were licensing fees that will be charged to prospective operators. There is a $100,000 application fee attached to any application that is received and there is a further $750,000 licensing fee for any application that is approved. Operators will have to renew the license every year at the cost of $150,000. Compared to other states, the licensing fees are relatively high, and will lead to additional sources of revenue for the state.
Some states have sports betting rules set by lawmakers, but that isn’t the case in Arizona. Lawmakers left that task up to the Arizona Department of Gaming, and that group is looking for public comment and opinion as well. On Wednesday, there will be another public hearing that is held, and industry stakeholders will be able to share their thoughts. The ADG accepted public comment on the first draft of the rules, but that will not happen this time around.
Sports betting partnerships still up for grabs
Even before the proposed tax rate was announced by the Arizona Department of Gaming, Arizona was expected to attract some of the top operators in the industry. Several of the biggest names have already made moves in the state by partnering with professional sports teams.
FanDuel has been named the official sports betting partner of the Phoenix Suns. A retail sportsbook will be established at Phoenix Suns Arena and should open in time for the next NBA season.
Caesars Sportsbook has agreed to partner with the Arizona Diamondbacks and can set up retail sports betting for home games. DraftKings has partnered with TPC Scottsdale, the course that hosts the Waste Management Open each year.
This still leaves some professional teams in Arizona without a partner, including the Arizona Cardinals. This will be a highly sought-after deal as the Cardinals are expected to drive sports betting in the state.
Bally’s made history by partnering with the Phoenix Mercury, becoming the first sports betting operator to partner with a women’s professional team.
In the National Hockey League, the Arizona Coyotes are another team that will be looking to offer sports betting. There are 10 licenses available for professional sports in Arizona, but only seven will be spoken for when the industry launches later this year.