BY: RUDI KELLER
Missouri Independent
The two online bookies who financed the campaign to legalize sports wagering in Missouri have won $120 million from bets placed in the state but so far have not had to pay any tax on those profits.
FanDuel and DraftKings handled 73% of the $928 million wagered in Missouri during the first two months of legal sports wagering, according to the latest financial report from the Missouri Gaming Commission. The two companies have 77% of the profits from those bets, but offset the entire amount won from players by deductions for promotional wagers and other costs.
Their winnings so far are about three times what it cost the companies in the 2024 election.
Missouri taxes the operator winnings of mobile platforms and casino-based retail sports at 10%, but the constitutional amendment passed in 2024 allows a write-off of all promotional costs, federal taxes and other business costs, from the taxable amount.
Sports wagering launched in Missouri on Dec. 1, and bettors placed $543 million in bets. The total fell in January but in the two months combined, the eight mobile providers and the eight retail locations have netted $157.7 million from lost wagers, with 99% of the profits going to mobile platforms.
The state has received $659,196 in taxes over two months, or just less than one-half of 1% of the amount won by the online and retail bookmakers.
“The latest data shows more Missourians are ditching their bookies and illegal websites and enjoying the safeguards and convenience of placing sports bets legally,” Jack Cardetti, spokesman for the Sports Betting Alliance, said in a statement to The Independent. “This initial success is building a rock-solid foundation that will ensure Missouri receives the ongoing benefits of legal, regulated sports betting for decades to come, including millions in permanent, dedicated tax revenues.”
DraftKings and FanDuel are dominating the market.
The two companies are almost equal in their share so far. Players wagered $339.7 million on the DraftKings platform and $338.4 million on the FanDuel app. DraftKings reported it won $54.4 million over the first two months, while FanDuel won $65.6 million.
During the 2024 campaign, FanDuel and DraftKings each contributed $20 million for the $43 million effort. Major Missouri sports teams contributed the rest.
Other than licensing fees, neither company has paid the state any taxes.
DraftKings has $20.6 million in net write-offs it will carry forward before it has any tax due. FanDuel has $8.1 million.
The total amount of unrealized write-offs for all eight mobile bookmakers is $33.8 million.