The Maryland Lottery on Monday proposed a change to the state’s sports betting regulations that would reduce the amount online sportsbooks can give away as promotional free bets.
Currently, under Chapter 13 of the state’s “Sports Wagering Licensee Minimum Internal Control Standards,” after the first full fiscal year of operations, a sportsbook is allowed to offer as much as 20% of revenue in free play. That figure would drop to 5% under the new proposal. This figure would include only money generated by online sports betting.
By lowering the amount that sportsbooks may offer as promo deductions, states are able to tax more of their revenue.
Changes to sports betting rules in Maryland are made with approval by the Maryland Lottery and Gaming Control Agency and sign-off by the Maryland General Assembly’s Joint Committee on Administrative, Executive and Legislative Review.
Maryland trying to tap sportsbook till again
This is Maryland’s second grab for more sports betting revenue this year. In May, Gov. Wes Moore (pictured above) signed the Budget Reconciliation and Financing Act of 2025, which contained a tax increase on sportsbooks that raised the rate from 15% to 20%. Moore had sought to raise the figure to 30%. It’s all part of a plan to winnow a $2.7 billion budget deficit.
Maryland’s move perpetuates a national trend of states increasing the cost of doing business either by raising tax rates or by limiting promo deductions. In May, Colorado passed House Bill 1311, which will reduce the promo deduction percentage from 2% to zero by July 1, 2026.
