Sportsbooks Site on Sidelines in Debate Over Colorado Tax Change

The Centennial State is considering a major change to how its sports betting tax revenue is spent, but sportsbooks are staying out of the debate.

Colorado Proposistion JJ would eliminate the state’s cap on sports betting revenue. The current law returns any funds over the cap to sportsbook operators in the state, though it hasn’t resulted in much over the years. An increase in overall revenue led legislatures to propose changing the law to allow the state to keep an extra tax revenue.

Sportsbooks across the US have fought hard against changes to tax rates, but there has not been a response to the Proposition JJ. While the operators would prefer to keep extra funds as the market continues to grow, but it seems they are willing to give them up to avoid a change to the state’s 10% tax rate.

Colorado has one of the lowest sports betting tax rates in the country at 10%. Many other states have are considering or have already implemented tax rate hikes, but the Centennial State has not followed suit. 

If Proposition JJ is passed, it is unlikely a tax hike would come any time soon.

Colorado Market Remains Popular with Sportsbooks

While the US sports betting market has grown to cover most of the country, Colorado remains among the most operator-friendly. The state’s low tax rate is a reflection of the politics, which tends to give businesses a lot of freedom compared to the rest of the country.

bet365 recently made Denver its headquarters in the US for the above reasons. The ability to operate at a lower tax rate gives them incentive to further invest in the state. In return, the sportsbook will create over 1,000 jobs for the state’s residents.