The total sports betting handle in Virginia dropped in May, but still managed to generate $42 million in gross revenue for sportsbooks. More significantly, the state surpassed a milestone by topping $5 billion in all-time sports handle.
Nine states have exceeded $5 billion on sports betting handle since a U.S. Supreme Court decision cleared the way for legalized sports betting in 2018: Colorado, Illinois, Indiana, Michigan, Nevada, New Jersey, New York, Pennsylvania, and now Virginia.
Virginia launched sports betting on Jan. 1, 2021, and in January 2022 it set a state record with more than $485 million in sports betting handle, spurred by the Super Bowl. The state legalized both online and retail sportsbooks, but there are no brick-and-mortar sportsbooks operational yet.
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Despite Lack of Pro Sports Teams, Virginia Betting Thrives
Of the nine states to have recorded $5 billion in sports betting handle, Virginia is the only one that does not host a single professional sports team from the major leagues (NBA, NFL, MLB, and NHL). Sports fans in the state show an affinity for the D.C. teams (Nationals in MLB, Commanders in the NFL, Capitals in the NHL, and Wizards in the NBA), as well as in-state college teams.
The 12th-largest state in the U.S. based on population, Virginia is the most populous state without a major professional sports league franchise playing in-state.
In the southern and western parts of the state, some fans show allegiance to the Tennessee Titans and the Charlotte Hornets. And a smattering of support exists for Baltimore teams from citizens in the northern part of the state, though many Virginians prefer Washington D.C. teams to the Ravens and Orioles.
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Revenue Increases by $94 Million Year-Over-Year
Virginia is recording amazing growth in its second year of sports betting. Total revenue in 2022 from January through May has been $179 million, compared to $85 million in 2021, an increase of $94 million. The total handle is more than $2.1 billion this year compared to $1.09 billion for the same period in 2021.
The state is reaping the benefits of the popularity of legal sports betting as $13.3 million in tax revenue has been generated in the first five months of 2022, compared to $5.5 million during the same period in 2021.
The bulk of taxes generated from sports wagering in Virginia goes to the General Fund Allocation, with a smaller portion allotted to the Problem Gambling Treatment and Support Fund Allocation. Thus far since 2021, that program has received more than $840,000.
In all, since the market launched on New Year’s Day in 2021, Virginia has received more than $33 million in taxes from legal sports betting activity, which does not include license application fees.
The law in Virginia levies a 15% tax on sports betting activity. That figure is applied to a sportsbook operator’s adjusted gross revenue (AGR), which is defined as total wagers minus total winnings and authorized deductions, such as the cost of promotions and bonus offers.