Maryland stands at a significant crossroads in its approach to gambling legislation. While the state boasts six commercial casinos that collectively earn hundreds of millions annually and has seen a swift expansion in its mobile sports betting market since it was introduced in 2022, it struggles to embrace online casino gaming. Efforts to legalize Internet gambling have repeatedly faltered within the General Assembly, leaving Maryland without access to a lucrative revenue avenue that its neighboring state, New Jersey, has successfully developed into a billion-dollar industry.
The differences between these two states are stark. As lawmakers in Maryland deliberate whether to present an iGaming referendum to the electorate, New Jersey’s online casinos generated a remarkable $2.91 billion in revenue in 2025—a milestone that exceeded the combined earnings from all nine physical casinos in Atlantic City for the first time. For Maryland’s decision-makers, the experiences of New Jersey serve as a valuable guide, outlining effective strategies, potential pitfalls, and the overall benefits of legalization.
With Maryland facing a daunting projected budget deficit of over $1.4 billion, advocates for online casino legislation contend that establishing a regulated iGaming industry could yield hundreds of millions in new tax revenues over the coming years, all without imposing additional taxes on residents. Thus, the pivotal question is no longer whether online gaming is feasible for Maryland, but rather if the state is ready to follow the well-worn path laid out by New Jersey.
New Jersey’s Model: Integrating Casinos with Online Gaming
One of the key takeaways from New Jersey’s approach is the importance of merging online gaming with the existing casino landscape. When New Jersey legalized iGaming in 2013, it mandated that every online operator partner with a licensed casino in Atlantic City. This strategy served multiple purposes: it not only ensured that traditional casino companies invested in the digital marketplace, substantially reducing opposition from those who might otherwise view online gambling as a threat, but it also fostered legislative support.
Moreover, this partnership model simplified regulatory oversight. Rather than constructing an entirely new licensing system, New Jersey expanded its existing regulatory frameworks to encompass online operations. The Division of Gaming Enforcement, already experienced in supervising Atlantic City’s physical casinos, took charge of monitoring online platforms. This continuity allowed for swift and uniform implementation of player protections, fair play standards, and anti-money-laundering measures.
Maryland could mirror this model. The state’s six casinos, which include notable establishments such as MGM National Harbor, Live! Casino and Hotel, and Horseshoe Casino Baltimore, are already regulated by the Maryland Lottery and Gaming Control Agency. Mandating that online operators collaborate with these established licensees would not only create a seamless regulatory framework but also ensure that the casino industry plays a proactive role in shaping the state’s gaming future instead of being positioned as a competitor.
Exploring Tax Rates and Revenue Potential
The set tax rate for online casino revenue influences the market’s growth potential significantly. Initially, New Jersey established its iGaming tax rate at 15 percent—a figure that successfully attracted a diverse range of operators while still providing substantial revenue for the state. By 2025, this rate rose to 19.75 percent, with lawmakers currently contemplating an increase to 30 percent. Even at the initial 15 percent tax rate, online casino taxes have historically contributed hundreds of millions of dollars to New Jersey’s treasury.
For those curious about the competitive online casino landscape supported by New Jersey’s tax policies, a comprehensive review of licensed platforms is available for anyone eager to play online with the state’s approved operators. The wide variety and quality of these platforms demonstrate the commitment and investment that operators have made in an environment that nurtures innovation.
Maryland should take careful note of this dynamic. Pennsylvania illustrates a cautionary tale; the state established a 54 percent tax rate on online slot revenue upon legalizing iGaming—the highest in the country. Although Pennsylvania has built a significant market, operators frequently claim that such high rates hinder their ability to offer competitive promotions and innovate. A more balanced tax structure, similar to the original rate in New Jersey, could attract a broader array of operators and foster greater long-term revenue growth.
Prioritizing Responsible Gaming from the Start
Discussions surrounding iGaming legalization must incorporate the principles of responsible gaming, with New Jersey providing an exemplary framework. All licensed operators in the state are mandated to implement self-exclusion programs, establish deposit limits, and offer time-out options. Additionally, operators are required to display responsible gaming messages prominently and provide access to resources for players experiencing gambling-related issues.
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| Metric | NJ Performance | MD Potential | Key Takeaway |
| Annual Revenue | $2.3B (2024) | $800M-1B est. | Strong market potential |
| Tax Rate | 15% | TBD | Competitive rate needed |
| Licensed Operators | 30+ | 10-15 est. | Healthy competition |
| Player Accounts | 3M+ | 1M+ est. | Large addressable market |
| Mobile Share | 85%+ | Expected 80%+ | Mobile-first approach |
The necessity for these safeguards is emphasized by recent research findings. A study published by Maryland Matters covering 2024 showed an increase in disordered gambling rates in the state, rising from 4 percent to 5.7 percent following the legalization of mobile sports betting. While mobile sports betting and online casino games differ, this data highlights the pressing need for robust protections in any emerging gambling market.
New Jersey’s enforcement strategies further enhance these protective measures. The Division of Gaming Enforcement conducts routine compliance audits of all licensed operators, and those found in violation face substantial penalties. Additionally, a statewide self-exclusion list, applicable to both physical and online casinos, ensures that individuals who opt to exclude themselves are barred from all regulated gambling platforms. Maryland could greatly benefit from instituting a similar comprehensive safeguard before permitting online casino operators to enter its market.
Legislative Path Ahead for Maryland
Maryland’s journey towards iGaming legalization encounters a distinctive constitutional obstacle. Current state regulations dictate that any expansion of gambling must receive voter approval via a ballot referendum. Consequently, even if an iGaming bill passes through the General Assembly, it must still appear on a general election ballot before online casinos can operate legally. The earliest chance for this would be the 2026 general election, provided lawmakers take action during the ongoing legislative session.
As highlighted by MarylandReporter.com, the regulatory landscape surrounding online casinos has become increasingly nuanced. States that embark on establishing iGaming markets today benefit from insights gained by early adopters such as New Jersey, Delaware, and Michigan, enabling them to implement more effective consumer protections from initiation.
Past legislative attempts have stumbled for various reasons. House Bill 1319, which received a favorable vote of 92-43 from the House of Delegates in 2024, did not survive in the Senate due to opposition from certain casino operators concerned about potential increased competition. In 2025, two more iGaming bills were proposed but failed to progress beyond committee stages. Advocates argue that a well-formulated bill that addresses casino industry apprehensions, proposes a reasonable tax rate, and incorporates stringent responsible gaming measures could secure the bipartisan backing necessary to make it to the ballot.
Economic Impact Beyond Direct Taxation
The economic advantages of iGaming stretch far beyond the immediate tax revenues it generates. In New Jersey, the online casino sector supports thousands of jobs in various fields, including technology, customer service, marketing, compliance, and game development, with many positions situated within the state. This contributes positively to local economies while broadening career opportunities in the expanding digital entertainment sector.
There are also indications that online gaming is more of a complementary force than a competitor to the revenue generated by physical casinos. For example, New Jersey’s land-based casinos garnered $2.89 billion in 2025, reaching their highest earnings since 2012, despite online revenues peaking. This indicates that online casinos tend to attract a different demographic of players—those who may live too far from Atlantic City for frequent visits or prefer the ease of playing from home. Maryland’s casino operators should observe this symbiotic relationship rather than perceive iGaming exclusively as a threat.
For Maryland, the financial potential is considerable. Analysts estimate that a well-regulated iGaming market in Maryland could secure between $200 million and $500 million in annual revenues within its first few operational years, depending on the number of active licensed operators and the structure of the tax rates. Such revenue could be instrumental in funding education, infrastructure, and public health initiatives, similar to how existing casino revenues currently support the state’s Education Trust Fund.
The Urgency of Action
Every year that Maryland postpones the legalization of iGaming, the state forgoes potential revenue opportunities to unregulated offshore platforms and to neighboring jurisdictions that have embraced legal online gambling. Currently, Maryland players seeking online gambling options beyond mobile sports betting find themselves without lawful alternatives, prompting many to resort to unlicensed sites that provide no consumer protections and yield no tax revenue for the state.
The decade-long experience of New Jersey illustrates how a well-regulated iGaming market can deliver substantial advantages for the public while safeguarding consumers and bolstering the existing casino industry. With its established regulatory framework, significant market potential, and pressing fiscal needs, Maryland is well-positioned to follow New Jersey’s proven model. However, it now requires the political determination to take action. The precedent has been set, and the question remains: Is Annapolis prepared to follow suit?
References
https://www.playusa.com/online-casinos/nj/
