BetRivers Becomes First Sportsbook To Not Implement Tax Surcharge

BetRivers Sportsbook, operated by Rush Street Interactive, is the first operator to publicly declare it will not be implementing a tax surcharge on winning sports bets. In fact, BetRivers made this announcement just days after DraftKings revealed its new plan to do so across four states in 2025.

BetRivers will not be joining DraftKings in implementing a tax surcharge in New York, Pennsylvania, and other states

DraftKings announced last week that it would be implementing a “gaming tax surcharge” on winning bets in Illinois, New York, Pennsylvania, and Vermont in order to help keep its tax rates around 20% in the jurisdictions.

The surcharge will be implemented in “high tax online sports betting states that have multiple operators (Illinois, New York, Pennsylvania, and Vermont) to ensure an operational effective tax rate of approximately 20%,” according to the company’s Q2 earnings report.

“We very efficiently acquired many more new customers than we expected and saw continued healthy existing customer engagement in the second quarter,” said Jason Robins, DraftKings’ CEO and Co-founder.

“We will continue to capitalize on the healthy customer acquisition environment for the rest of 2024 which positions us to achieve $900 million to $1.0 billion of Adjusted EBITDA in 2025.

“Additionally, we plan to implement a gaming tax surcharge in high tax states that have multiple mobile sports betting operators on January 1, 2025, which could drive Adjusted EBITDA upside on an annual basis.”

Rush Street Interactive is focusing on customer satisfaction, excellence in the online gaming industry

Rush Street Interactive, with its BetRivers brand, is not currently interested in pursuing such a strategy. BetRivers is live in New York, Pennsylvania, and Illinois, three of the four states DraftKings will introduce its new tax surcharge.

“As we put our customers first, it was an easy decision for us,” Richard Schwartz, CEO of RSI, said in the release.

Schwartz added, “RSI remains committed to maintaining its leadership position in the industry by continuously prioritizing the needs and preferences of its players. We believe that RSI’s focus on customer satisfaction, coupled with its innovative rewards and loyalty programs, sets a benchmark for excellence in the online gaming industry.”

Rush Street Interactive became the first gaming company to publicly call out the new DraftKings plan. Other operates may soon be joining DraftKings on instituting a tax surcharge of their own.

However, neither BetMGM nor Caesars mentioned plans during their recent earnings calls for a tax surcharge. If the plan is on the agenda, it probably would have been discussed during the reports.