The gambling scene in New Jersey has heated up over the last few weeks. Not only has there been an increase in the gambling tax signed into law, but stakeholders within the sweepstakes sector have petitioned Governor Phil Murphy to reverse a recent ban. On top of this, the state has recorded a record amount of online gambling revenue, which means the future of the sector is up in the air.
These developments come as no surprise, as there has been a heightened interest in online gambling globally. Whether it is traditional online gambling or sweepstakes, this interest shows no signs of stopping, which means the current situation must be addressed in some way.
Governor Phil Murphy recently received a petition from The Social Gaming Leadership Alliance, which represents the interests of companies in the sweepstakes sector. This petition was in response to a recent ban on sweepstakes by lawmakers. Many residents in New Jersey and beyond happily flock to various sweepstakes sites for the benefits they offer, as well as the variety of games ( source: progressivesweepslots.com).
But not everyone sees the value in them, as the state legislature recently approved a ban on sweepstakes. The idea behind this is that sweepstakes gambling is too similar to actual gambling and needs to be banned. But the Alliance disagrees and has deemed this move “the wrong solution to a misunderstood issue.”
According to Jeff Duncan, executive director of the Social Gaming Leadership Alliance, these actions would harm not just sweepstakes but other businesses within the state, and now, they are hoping that the governor will take some action.
This decision to ban sweepstakes comes at an interesting time, as the state is getting more money from online gambling than ever before.
According to data from the New Jersey Division of Gaming Enforcement, May was an especially profitable year for online gambling in the state. The total revenue for the month came to $614.7 million, which was an increase of 20.5% from the previous year and also 14.6% higher than April of 2025. A look at these figures shows some interesting trends regarding online and land-based gaming.
First, land-based establishments drew in more revenue for the first time in months. Recent consumer trends would have suggested that online revenue would continue to dominate, but clearly, there has been a shift. May 2025 also represented a major month for iGaming revenue. The figure reported was 28.5% higher than in 2024 and 4.9% higher than in April.
$244.2 million of this came from online slots and tables, and $2.7 million was brought in by internet poker. These figures are not surprising given that iGaming is so immensely popular around the world. This also speaks to the concerns of stakeholders within the sweepstakes sector, as more states are passing pro-iGaming regulations to get a piece of the market.
But even with all of this, land-based establishments have seen a resurgence in interest. According to the same figures, $265.3 million in revenue was raked in by these casinos, 10.9% more than was reported last year. $194.8 million of this was brought in by slot machines, and $70.5 million was generated from table games.
Regardless of opinion on whether iGaming or land-based establishments will continue to dominate, the tax revenue generated for the state continues to be significant. This also comes around an interesting time, given that the New Jersey governor just signed a bill that would increase the tax rate.
On July 1, 2025, Governor Phil Murphy signed a new law that would see the tax rate for online gambling in New Jersey raised. In the past, the rate for 15%. Now, it has risen to 19.75%, sparking mixed responses from the public.
On the one hand, some argue that the growing iGaming market should be taxed heavily and generate more income for the state. The market is only going to become more valuable, and the money generated from it could be used to fund worthwhile projects in the areas that they profit from. Some also feel that this new tax rate is not necessarily an outrageous one. After all, New Jersey still has one of the lower tax rates compared to States like New York with a 51% rate.
On the other hand, some industry stakeholders argue that companies will simply leave New Jersey and go to more favorable locations over time. Both within and outside the United States, various regions and states are optimizing their iGaming laws to attract more business. With that in mind, stakeholders argue that an increase in the tax rate is counterproductive.
With all these developments considered, the New Jersey gambling scene could look very different in the next few years. First, there is the sweepstakes situation. The law banning it has not been formally signed by the governor, and there is still a chance it will be vetoed. If it is, the state can continue to maintain a presence in the sweepstakes sector. If not, New Jersey residents will lose out on the experience of sweepstakes betting.
The new tax rate, while higher than before, does not make New Jersey one of the harshest on gambling. So while there has been some pushback to the law, it should not have a devastating effect.
Then there is the revenue from gambling, both online and in-person. The numbers suggest that both these types of gambling are popular and profitable, though the dominant one is not set in stone.
It will be interesting to see over the next few years which one comes out on top, both in terms of New Jersey itself and the wider consumer market. Hopefully, the success of the gambling sector will be followed by better regulation that protects customers and ensures its long-term survival.
