NJ took in twice as many sports bets as PA last month. Which state collected more taxes?

New Jersey bookmakers took in more than double the number of sports bets as Pennsylvania. But Pa. collected more tax revenue, thanks to a much higher tax rate.

Sports betting in New Jersey and Pennsylvania surged in September, coinciding with the start of the professional and collegiate football seasons. Carson Wentz scrambles with the football against the Minnesota Vikings on Sunday, October 13, 2019 in Minneapolis.Read moreYONG KIM / Staff Photographer

by Andrew Maykuth

Published Oct. 17, 2019, 5:59 p.m. ET

Sports betting surged to record highs in Pennsylvania and New Jersey last month, the first full month of professional and college football seasons, according to state regulators.

Bettors in the two states wagered $640 million in September, and gambling operations retained $52.7 million in gross revenue. Though New Jersey took in more than double the number of sports bets as Pennsylvania, the Keystone State collected more tax revenue, thanks to a much higher tax rate.

Pennsylvania on Thursday said that bettors wagered $194.5 million on sports in September, up 78.4% from August. Legal bookmakers reported $14.9 million in gross revenue from sports betting, an increase of 144% from the previous month, according to data released by the Pennsylvania Gaming Control Board.

New Jersey, which got a head start on legalizing sports betting last year following a favorable U.S. Supreme Court decision, reported $445.6 million in sports betting handle in September, up 51.7% from August. Betting operators reported $37.8 million in gross revenue, up 50% from the previous month, according to data released by the New Jersey Division of Gaming Enforcement.

Pennsylvania took in $5.3 million in tax revenue from sports betting, based upon its 36% tax rate on gross revenue (2% is set aside for host communities).

New Jersey, though it generated much more sports-betting revenue than Pennsylvania, collected $4.5 million in taxes, based upon a 13% tax rate on internet sports bets, and an 8.5% tax rate on bets placed in retail sportsbooks at casinos and racetracks.

The Valley Forge Casino Resort, one of Pennsylvania’s smaller casinos, is the surprise leader for sports betting in Pennsylvania by virtue of its partnership with FanDuel, the popular fantasy sports giant. More than 45% of all sports bets placed in Pennsylvania in September — $88.5 million — were wagered with FanDuel or in Valley Forge’s retail operation.

Valley Forge reported $5.1 million in sports-betting revenue in September. More than 92% was generated from online betting.

SugarHouse Casino in Philadelphia and Parx Casino in Bensalem were ranked second and third for sports-betting revenue, with $2.9 million and $2.4 million, respectively. Both casinos reported more than $1 in revenue generated at their brick-and-mortar retail operations, and the rest from the internet.

Parx’s two satellite sportsbooks at its off-track betting locations in South Philadelphia and in Audubon generated an additional $636,000 in revenue.