Colorado's HB 1311: Phasing Out Tax Deductions for Free Sports Bets
Colorado legislation intended for a 2026 session concerning the imposition of taxes on promotional bets.
Listen up, sports betting enthusiasts! Michael Savio, your go-to guy for all things online casino, has got the scoop on a game-changer bill in Colorado - HB 1311. This bad boy aims to shake up the sports betting industry, and here's the lowdown.
The Nitty-Gritty
HB 1311 is a bill in the Colorado legislature that's gonna rewrite the rules for how sports betting operators deal with those enticing free bets you love to snag. The aim is to boost state revenue, without increasing the current 10% tax rate, by closing perceived loopholes[3][4].
Key Changes
- Current Game: Operators can deduct player payouts, federal excise taxes, and a capped percentage of free bets. The cap was due to drop from 2.25% to 1.75% by FY2026-27[4][1].
- HB 1311 Shake-up: The bill introduces a phase-out of free bet deductions:
- July 1, 2025 – December 31, 2025: A max of 2% of monthly free bets can be deducted.
- January 1, 2026 – June 30, 2026: A max of 1% of monthly free bets can be deducted.
- Starting July 1, 2026: No more free bet deductions are allowed[1][4].
- Coin Count: The bill is expected to rake in an extra $3.2 million in FY2025-26, jumping to $12.9 million in FY2026-27 and $11.5 million in FY2027-28[4].
- Where Does the Moolah Go? Most of the new revenue will go towards state water conservation (94% to the Water Plan Implementation Cash Fund), with 6% helping out the Wagering Recipients’ Hold Harmless Fund[3][4].
Legislative Dance
- House Steps: Introduced and passed the House Finance Committee with a 9-3 majority[3].
- Senate Groove: Moved on to the Colorado Senate and underwent amendments, changing the original effective date from September 1, 2025, to July 1, 2026[4].
- Governor's Sign-Off: Signed into law by the Colorado governor on or around May 16, 2025[2].
Clock's Tickin'
| Time Period | Max Free Bet Deduction Allowed ||-------------------|-------------------------------|| July 1, 2025 – Dec 31, 2025 | 2% of total free bets per month || Jan 1, 2026 – June 30, 2026 | 1% of total free bets per month || On and after July 1, 2026 | 0% (no deduction allowed) |
Extra Sauce
- Agenda: The bill's aim is to bolster state revenue for water conservation and support for state agencies without raising tax rates on sportsbooks[3][4].
- Cheerleaders: The bill enjoys broad backing, with names like Speaker of the House Julie McCluskie, Representative Matt Soper, and Senator Dylan Roberts onboard[3].
The Final Whistle
HB 1311 is now law in Colorado, set to phase out the deduction for free bets by July 1, 2026, generating a heap of extra cash for water conservation and other causes[1][2][4]. Keep an eye out for Michael Savio's latest articles at casinos.com for more hot takes on the industry! 🎲💰
Online casino enthusiasts in Colorado are excited about HB 1311, a bill that aims to boost state revenue while potentially impacting sports betting. Starting July 1, 2025, the bill will phase out the deductions allowed for free bets, with a max of 2% allowed until December 31, 2025, decreasing to 1% from January 1, 2026, to June 30, 2026, and being completely phased out starting July 1, 2026. This move might affect sports betting in Vegas and other online platforms offering sports betting in Colorado.
