Ohio Governor Mike DeWine rolled out his final budget proposal, calling for legislators to double the tax on sports gambling…again. 

When Governor DeWine first signed the bill that legalized sports gambling in Ohio, the tax rate was set at 10%. Two years later, just months after sports gambling took effect in the state, DeWine pushed legislators to double the tax rate to 20%. Now, just two years later, Governor DeWine wants to double the tax rate again, from the current 20% to a whopping 40%, amounting to a 400% tax increase over two years. 

The governor’s proposal calls for a massive tax hike on sports gambling to fund a new “Sports Construction & Education Fund”, which would finance professional sports facilities. This move comes as the Cleveland Browns prepare to relocate their stadium to the suburbs and the Cincinnati Bengals plan major renovations to their stadium. If I were the Cleveland Browns, I would prioritize funding for a new stadium over giving $230 million to DeShaun Watson. 

If the tax is doubled again to 40%, Ohio would have the second-highest gambling tax rate in the nation. This distinction would increase costs and make the state less attractive to sports gambling operators, especially compared to neighboring states like Indiana, Michigan, and West Virginia, which have tax rates of 9.5%, 8.4%, and 10%, respectively. Why make your bets in Ohio when nearby states will take a significantly smaller portion of your winnings? 

This tax hike is expected to take an additional $130 million to $180 million per year from taxpayers’ pockets. Whether that money is spent on stadiums or funneled into other government programs, it’s still coming out of the pockets of businesses and consumers who are already dealing with economic pressures. 

The higher costs imposed on operators would inevitably be passed on to consumers through worse odds, reduced promotions, and increased fees, making sports betting less appealing. As operators face rising expenses, they may cut back on customer incentives, worsening the overall betting experience. With lower customer incentives, state revenues could decrease as bettors turn to illegal markets or bet less overall. 

The strongest and most sustainable sports gambling markets follow conservative, free-market principles, creating low-tax environments with focused regulations that put integrity first and do not overburden the industry. In turn, this reduces betting activity in illegal markets. The higher costs imposed by the tax hike could push bettors toward offshore or illegal markets, where they can find better odds and fewer restrictions but at the risk of fraud, lack of consumer protections, and unreliable payouts. 

Taxpayers—whether they are sports fans or not—should not be forced to hand over hundreds of millions in hard-earned tax dollars to team owners and some of the wealthiest sports leagues in the world. While proponents claim that stadium projects create jobs and boost the local economy, research consistently shows that these benefits are exaggerated. Publicly funded stadiums rarely generate enough tax revenue to justify their cost, leaving taxpayers to foot the bill for projects that offer little public benefit. In the end, taxpayer-funded stadiums offer little to the average American. 

Hiking the tax on sports gambling to fund any new government program—whether related to stadiums or not—is simply bad policy. Raising taxes discourages economic activity, imposes unnecessary burdens on consumers, and expands government at the expense of hardworking Ohioans. In recent years, Ohio has made significant strides in tax reform, reducing its income tax from four brackets to two and lowering rates. If Ohio truly wants to remain competitive and foster a thriving market, it should focus on lower taxes and smarter spending—not on using gambling revenues as a blank check for new projects. 

If a team wants a new stadium, it should pay for it—just like any other business looking to expand or upgrade. 

Americans for Tax Reform firmly opposes any and all tax hikes, including the proposed increase in the sports gambling tax to fund a new stadium for the Cleveland Browns. We urge all Ohio legislators to reject the governor’s attempt to raise taxes and burden taxpayers with another unnecessary cost.