How Michigan Won the Race for Reaching $2 Billion in Online Casino Revenue
Nov 02, 2022
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Michigan's earnings from online casinos have surpassed the $2 billion threshold. The state became the fastest state to attain this milestone, doing so in just 20 months. It is evident that Michigan was well prepared for online gambling when it launched in January 2021, beating its nearest rival by almost a year.
The Michigan Gaming Control Board announced 130.9 million dollars in online casino earnings for August 2022 on September 20. With that, the state's total iGaming income since its start 20 months ago is $2,028,559,830.
Only two other states, New Jersey and Pennsylvania can claim to have earned $2 billion from internet casinos. While it took New Jersey a total of 81 months to get there, Pennsylvania needed 30 months to do it.
Reasons why Michigan Won the $2 Billion iGaming Revenue Race
On January 22, 2021, Michigan accepted the challenge of launching both online casinos and sports betting.
Ten online sportsbooks and eight online casinos went live in Michigan on the first day. It was easier to lay the framework for a successful launch because all tribal casinos were on board with debuting the online gambling market.
By being clear with the standards and the deadline, the MGCB also placed the onus on the operators to have their goods ready by launch day. It was then up to them to ensure that their platform was ready to use.
Upon opening, Michigan was able to bring new consumers to both the online casino and the online sports betting services.
On the day of the introduction, Michigan also had well-known companies like BetMGM, DraftKings, and FanDuel on board. With those well-known operators promoting their sports betting and online casino offerings, the market was able to provide customers with a large number of start-up discounts. And now, there are plenty of Michigan no deposit casino offers to choose from for those who want to start their gaming experience right.
New Jersey opened its first online casino in late November 2013. It was exclusively intended for iGaming at first, and there were only five operators accessible. When online sports betting began in the autumn of 2018, New Jersey's monthly online casino income began to increase.
In July 2019, Pennsylvania legalized online gambling, although there weren't many operators or games to choose from. Sports betting debuted in Pennsylvania in June 2019.
How Michigan Tax Rates Influenced iGaming Market’s Success
In Michigan, the tax rate is on a sliding scale. For monthly gross receipts of under $4 million, it drops to as little as 20%. For gross receipts above $12 million, it can reach a maximum of 28%.
Operators are subject to a 54% tax in Pennsylvania on online slots and a 16% tax on poker and table games. All online gambling revenue is subject to a 17.5% tax in New Jersey.
A beneficial advertising strategy for its operators was also implemented in Michigan at launch. They were permitted to set aside up to 10% of their gross earnings for advertising during the first three years of operation. This changes to 6% in Year 4, 4% in Year 5, disappears in Year 6 and later, and then returns in Year 8.
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