Pennsylvania Betting Still Growing, Which Could Spike Taxes

Pennsylvania betting has been a huge success. And we’re not just talking about sports betting either. The state is one of less than a dozen that offer iGaming (online casino), and that’s been an even bigger hit than sports gambling.

During 2025, the Pennsylvania Gaming Control Board reported total revenues of $6.8 billion. That’s a staggering number, which is in turn, pouring hundreds of millions back into the state in the form of taxes. So much so that there have been talks of increasing the tax rate, and getting more out of the industry.

Will they pull the trigger? That’s what we want to cover in today’s article. We’ll look into the state’s recent performance and whether it warrants deeper taxes or not.

Gambling Revenues Up Double Digits

January 2026 numbers are out and total gambling revenue — across sports and casino together — hit $590.6 million for the month. For reference, that’s up 12 percent compared to last January. Though, it is down from December 2025 by four percent. That’s to be expected, though. Because of the holidays, December is usually a better month anyway as more people have time to throw a sports or casino bet.

When we say gross revenue, we’re talking about the money that’s kept after paying out winning players. The amount of money that’s shared by operators and the state’s tax books.

The bulk of those revenues came from casino betting, not sports. iGaming, in particular, carried the state. Online casinos pulled in $249.3 million in revenue in January. That’s up almost 19 percent from a year ago, though a tick below December’s all-time high. Online slots did most of the heavy lifting at $194.8 million — easily the biggest single slice of the pie. Table games chipped in $52 million, while online poker dipped slightly to $2.5 million.

Some of you may be asking, “why such a big disparity between slots and other casino games?” This is actually commonplace in the casino industry, not just in Pennsylvania. This is why slot machines occupy so much more space inside real casinos than blackjack or roulette tables. The quick games, plus the built-in house advantage of the slots, mean these machines print money for operators, as you see in the January figures.

Operator-wise, Hollywood Casino at Penn National and its online partners led the pack again with $96.2 million in revenue. Valley Forge wasn’t far behind at $67.2 million, followed by Rivers Philadelphia at $40.1 million. This is the usual iGaming pecking order in the state, so no surprises there.

What about retail casinos? They didn’t fare too shabbily either. Physical slots brought in $189.1 million, up slightly year over year. Table games added another $75.8 million. Even truck stop VGTs nudged higher. All this is to say the casino business is extremely healthy in Pennsylvania.

Sports Betting No Slouch

Don’t get it twisted, Pennsylvania sports betting ain’t underperforming by any means. Its January revenue figures were big beats across the board too. Revenue jumped 38.6 percent year over year to $71.4 million total. Mind you, this time last year, the local Eagles were making a run to the Super Bowl so a near-40 percent improvement is extra impressive to see in 2026.

Online betting continues to do almost all the revenues. Of that $71.4 million, $67.6 million came from top sports betting apps, while retail sportsbooks scraped together just $3.8 million. Bettors wagered $782.4 million during the month, which was down about 10% from last January. The Eagles effect, we suppose. But since they were winning a year ago, that’s why revenues (the money operators keep) was low.

Among the betting apps, FanDuel remains in first place. They pulled in $27.7 million on a $276.3 million handle, good for a 10 percent hold. DraftKings weren’t far behind, generating $22.7 million from $235.8 million in bets. Fanatics came in third overall with $5.6 million on $56.3 million wagered. This too is the usual Pennsylvania operator rankings in sports.

Here’s where you really see the difference for Pennsylvania between casino and sports: state tax revenue. Get this, iGaming produced a whopping $113.9 million in tax revenue during January. Sports betting? A meager $25.7 million in comparison. Physical casinos chipped in $95.6 million from slots and another $12.8 million from table games. Casino dominance, indeed.

Tax Increase Coming Soon?

Despite the huge — and we mean huge — disparity in tax revenue between casinos and sports, the state of Pennsylvania has floated a tax rate increase on sports only. That’s right, this was a heavily talked-about rumor toward the tail end of 2025.

Mind you, the state already taxes sports betting at a steep 36 percent. That’s not as high as New York betting (51 percent, most in the country), but it’s certainly on the higher end as is. Just how high could they go? 40 percent feels too modest (why only increase it by 4 percent?). 45 percent, perhaps, but maybe 50 percent if lawmakers are feeling cocky.

And that’s the issue: politicians are emboldened to do this. That’s because Pennsylvania faces a budget deficit statewide. To fill it, it almost has to come from more taxes because, let’s face it, banking on politicians to spend less is a losing proposition most of the time.

The success of January’s numbers probably makes a higher tax rate inevitable at this point. We’ll monitor the situation and report back if any tax rate gets officially proposed.