In 2025, efforts to expand the gambling industry in the United States encountered significant obstacles as legislators concentrated on tightening existing sports betting and online casino markets rather than facilitating expansion. Discussions surrounding gambling policies were marked by a focused campaign against unregulated sweepstakes casinos, while proposals for expanding sports betting and online casino markets largely stalled due to integrity concerns, political hurdles, and increasing scrutiny over problem gambling. Meanwhile, several states moved to increase taxes on sports betting to address budget deficits, highlighting a shift from growth-focused strategies to revenue augmentation.
Federal discussions on gambling regulation gained momentum following a series of sports betting scandals in late 2024. Despite multiple legislative attempts failing to progress in Congress in recent years, calls for reform resurfaced. Notably, Representative Dina Titus of Nevada sought an expedited hearing on the Fair Accounting for Income from Betting Earnings and Taxation (FAIR BET) Act, aiming to restore the full income tax deduction for gambling losses, a move partially curtailed by the previous administration. Furthermore, Senator Richard Blumenthal and Representative Paul Tonko co-sponsored the Supporting Affordability and Fairness with Every Bet Act (SAFE Bet Act), proposing national advertising standards and restrictions on certain betting practices, while urging federal involvement in regulating the sector.
Throughout 2025, numerous states took measures against sweepstakes casinos deemed unregulated. Lawmakers in states such as California, Connecticut, and New York passed legislation prohibiting these operations, reflecting a broader consensus on their classification as illegal gambling. In contrast, Louisiana’s Governor Jeff Landry vetoed a ban, citing existing regulatory measures, prompting the Louisiana Gaming Control Board to issue cease-and-desist orders to offshore operators. Other states, including Maryland and Mississippi, considered similar bans, although these efforts stalled.
Concurrently, several states acted to increase sports betting taxes. Illinois implemented a tiered tax system ranging from 20% to 40%, accompanied by a per-bet fee for sportsbook operators. Maryland adjusted its tax rate to 20% following initial proposals for a more substantial increase, and New Jersey raised its rate to 19.75%, aligning it with the iGaming tax rate. Louisiana adjusted its rate to 21.5%, while Ohio postponed a proposed increase to 40%, reflecting ongoing fiscal pressures as federal budget allocations to states are expected to decrease.
Attempts to expand online gambling faced significant challenges amid growing concerns over problem gambling and negative public sentiment. Legislative proposals in several states, including Minnesota and Georgia, failed to gain traction, and public opinion surveys indicated increasing skepticism toward sports betting. In Alabama, legislative efforts collapsed, with key proponents expressing doubts about future progress. Oklahoma’s initiatives faltered due to political disagreements over tribal gambling exclusivity.
Despite these challenges, Hawaii showed some progress, with a sports betting bill advancing further than in previous attempts, though it ultimately did not pass. Meanwhile, online casino legislation encountered similar resistance, with concerns about potential problem gambling and revenue cannibalization from traditional casino operators impeding progress. States such as Maine and Illinois explored online gambling legislation, but efforts were either stalled or redirected toward other fiscal measures.
As 2026 approaches, the landscape for US gambling legislation remains complex, with states preparing to revisit these issues. Discussions on the future of sweepstakes casinos are expected to continue in Florida, Indiana, and Maine, while tax strategies and online gambling expansion will likely remain key topics of debate as states navigate their fiscal and regulatory environments.