In this analysis, BonusFinder.com, a company specializing in online casino research and casino bonus comparisons, estimates how much each US state could be earning in tax revenue if they legalized online casino gambling — and the numbers are staggering.
💡 Key takeaway
Legal online casinos brought in $8.41bn across just seven states in 2024. If all remaining states regulated the market, they could collectively generate up to $18.5bn in annual tax revenue. California alone could make over $1.6bn a year.
Online casinos: The billion dollar opportunity
The current seven states that have legalized online casinos – West Virginia and Rhode Island – generated a combined online casino revenue of $8.41bn in 2024 alone; according to the American Gaming Association (AGA) report.
BonusFinder took that figure to calculate just how much each US state could earn in tax revenue if they legalized online casinos. Calculations have been created based on average tax rates of 20% and 30%.
How much are the top 10 states missing out on?
When it comes to potential tax revenue from online casino gambling, the numbers speak for themselves – especially in the most populous states. To estimate the potential tax revenue for each US state, we first calculated the average gross online casino revenue per adult based on the seven states where online casino gambling is already legal.
In 2024, those states generated a combined $8.41bn in gross revenue, with an adult population of 32,050,692 – resulting in an average of $262.40 in revenue per adult.
Using this figure, we projected potential gross revenue for all other states based on their adult populations (sourced from the US Census Bureau’s 2024 estimates) and calculated how much each of the top 10 states could earn based on two different tax rates:
- 20% – Median online casinos tax rate
- 30% – Average across all states where online casino gambling is legal
1. California
- Adult population: 31 million
- Estimated gross revenue: $8.14 bn
- 20% tax rate: $1.63bn
- 30% tax rate: $2.44bn
Sitting at the top, for the state with the potential to rake in the most from tax revenue generated from online casinos, California holds first place. The state has the potential to generate $8.14bn in annual gross revenue from online casinos alone. When adding a 20% tax rate, the Golden State could make a potential $1.63bn in tax revenue each year, or at a 30% tax rate it could make $2.44bn.
2. Texas
- Adult population: 23.6 million
- Estimated gross revenue: $6.2bn
- 20% tax rate: $1.24bn
- 30% tax rate: $1.86bn
The Lone Star State ranks second in potential tax revenue, with Texas online casinos projected to generate between $1.24bn and $1.86bn annually.
3. Florida
- Adult population: 18.9 million
- Estimated gross revenue: $4.95bn
- 20% tax rate: $990m
- 30% tax rate: $1.49bn
Florida could bring in nearly $1bn in tax revenue through online casino gaming at a 20% rate. At 30%, that number rises to almost $1.5bn, placing Florida firmly among the top states in potential online casino earnings.
4. New York
- Adult population: 15.9 million
- Estimated gross revenue: $4.17bn
- 20% tax rate: $830m
- 30% tax rate: $1.25bn
New York could generate $830m to $1.25bn annually in tax revenue from online casino gaming, leveraging its dense population and strong digital infrastructure.
5. Illinois
- Adult population: 10 million
- Estimated gross revenue: $2.63bn
- 20% tax rate: $525m
- 30% tax rate: $788m
Illinois has already shown interest in expanding digital gambling. Legalizing online casinos could bring in $525m to $788m in new tax revenue based on current projections.
6. Ohio
- Adult population: 9.6 million
- Estimated gross revenue: $2.44bn
- 20% tax rate: $488m
- 30% tax rate: $732m
Ohio could add $488m to $732m to its state budget by legalizing online gambling. With a growing tech scene and a ive sports betting market, it’s well-positioned for expansion.
7. North Carolina
- Adult population: 9.3 million
- Estimated gross revenue: $2.28bn
- 20% tax rate: $455m
- 30% tax rate: $683m
Sitting firmly in seventh place is North Carolina. If the state was to legalize online casinos it could be in with a chance to generate between $455m and $683m in tax revenue. These funds could then go to multiple positive social causes.
8. Georgia
- Adult population: 8.3 million
- Estimated gross revenue: $2.27bn
- 20% tax rate: $453m
- 30% tax rate: $680m
Georgia could earn $453m to $680m in annual tax revenue through online gambling. With its strong population growth, it’s one of the Southeast’s most lucrative untapped markets.
9. Virginia
- Adult population: 6.7 million
- Estimated gross revenue: $1.82bn
- tax rate: $363m
- tax rate: $545m
Virginia is rapidly modernizing its gambling laws. Legalizing online casinos could bring in between $363m and $545m annually, offering a sizable new revenue stream.
10. Washington
- Adult population: 6 million
- Estimated gross revenue: $1.65bn
- 20% tax rate: $330m
- 30% tax rate: $496m
Washington could add up to $496bn a year in tax revenue from online casinos, helping to infrastructure, education and other public services.
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Where does the tax revenue from iGaming go?
In the seven states where the full spectrum of iGaming is available, which includes both online sports betting and online casino gambling, is legal, tax revenue isn’t just a number – it’s actively funding key public programs and services.
Here’s how some states are putting their tax dollars to work:
- Michigan: iGaming tax revenue s the School Aid Fund, the First Responder Presumed Coverage Fund, the Agricultural Equine Industry Development Fund as well as responsible gambling initiatives and treatment programs.
- Pennsylvania: A large portion of tax revenue from online casinos goes towards lowering school propert taxes, ing local agriculture and funding economic development.
- New Jersey: Revenue is allocated to the Casino Revenue Fund, which helps programs for seniors and disabled residents. This fund helps to lower bills and offers property tax reductions vulnerable of society.
- West Virginia: Funds are directed into the West Virginia Lottery Interactive Wagering Fund,which contributes to the State Lottery Fund which also s the pensions of West Virginia racing employees.
- Connecticut: iGaming tax contributions the state budget and from there are redistributed to programs including education, investments in infrastructure, policing and emergency services.
- Delaware: Tax revenue is divided among the Delaware’s General Fund for education, public services and safety as well as helping to supplement horse racing purses.
- Rhode Island: This tax revenue s the general fund, which is used for essential services such as public safety programs, healthcare education and infrastructure.
What about online sports betting?
While online sports betting is now legal in 34 states, it generated just $11.22n in gross revenue in 2024. In contrast, online casino gaming — legal in only seven states — brought in $8.41bn during the same period.
Online casino gaming tax revenue estimations per state
Methodology
Total iGaming revenue from online casinos in 2024 ($8.41bn) was divided by the adult population of the seven states where online casino gaming is legal (32,050,692) to calculate average revenue per adult ($262.40).
This figure was then multiplied by the adult population of each state that does not allow online casino gaming to estimate potential gross revenue.
To estimate potential tax revenue, we applied a 20% and a 30% tax rate – based on current tax structures across legal states. Here’s how those tax rates break down:
- Connecticut: 18%
- Delaware: 20% (casino table games and poker), ~57% (online slots)
- Michigan: 20–28%
- New Jersey: 17.5%
- Pennsylvania: 16% (table games and poker), 54% (online slots)
- Rhode Island: 50%
- West Virginia: 15%
While tax rates vary significantly – particularly for online slot games – the median effective rate is around 20%, and the average is closer to 30%.
