Virginia Falls Short of the $400 Million Benchmark for April
The Virginia Lottery reported its numbers on Wednesday as it showed bettors across the state wagered close to $400 million for April. The betting handle just fell short of the $400 million mark by about $530,000.
Virginia Sports Betting for April
The Old Dominion’s handle for the month ended the six-month streak of hitting the $400 million mark. This is the first month operators in the state registered a combined handle of under $400 million since September 2021.
It would have taken Virginia less than $22 million to clear the $5 billion benchmark, making it the ninth jurisdiction to do so. As the figures stand for the month, Virginia has the fifth-highest handle in the industry as prominent markets like Arizona and Illinois have yet to report their numbers.
The handle had a healthy increase in March, thanks to the March Madness Tournament. However, the numbers across the board are set to decline as the summer months approach. Sporting events like the MLB don’t attract as much betting volume compared to the NFL, NBA, college basketball, and college football.
This is just the beginning, as the handle decreased by 14.9 percent from the previous month. However, many jurisdictions, including Virginia, have reported solid increases in their respective year-over-year figures. The Old Dominion’s handle portrayed a 69 percent increase from April 2021.
What is the Promotional Deduction Situation Like in Virginia
The gross gaming revenue was also higher by nine percent, thanks to a stronger hold percentage rate for the month. The bookmakers combined to register a hold rate of 9.1 percent compared to 7.2 percent in March.
Virginia is one of the states in the sports betting industry that allows its sportsbooks to use promotional credit deductions to lower the amount of taxes that are paid. That means the state misses out on large amounts of potential revenue that could be used to fund different programs across the state.
However, the amount was much lower for the month, which allowed the state to tax a larger amount as the adjusted revenue was slated at $20.8 million. This was also the second-highest total since the market launched, which allowed the state to collect over $3 million in taxes.
The number of promotional credits noted a significant decline of 20.2 percent from March, but it is also the eighth straight month the promotional credits exceeded $10 million. There is a chance that Virginia could be the first state to lose promotional deductions.
Operators in New York pay a tax rate of 51 percent and don’t have the option to use these deductions. If that is the case, the state of Virginia will be able to collect more taxes annually.
What Will Virginia Sports Betting Look Like Heading into the Summer Months
There will be fewer sporting events that attract sports bettors not only in Virginia but throughout the industry. Despite a difficult economy, the industry has remained strong and has proven to be resilient.
Eric Ramsey, who is an analyst for PlayUSA.com Network, stated, “Those opportunities will shrink in the coming months until football season kicks off. But Virginia’s young market is well-positioned for another surge this fall.