North Carolina, New Jersey Advance Prediction Market Tax Plans

North Carolina and New Jersey are moving ahead with new tax proposals targeting prediction market operators, adding more pressure on the fast growing event based trading sector.

The proposals come as more states take a closer look at prediction markets and search for ways to generate tax revenue from platforms such as Kalshi and Polymarket. Both states are now weighing measures that would place new tax obligations on operators as activity in the sector continues to rise.

North Carolina’s latest budget proposal includes a 6% tax on prediction market operators, while New Jersey lawmakers are advancing legislation that would impose a 9% surtax on gross income earned by prediction market platforms. The moves shows that states become more active in shaping how prediction markets are taxed and regulated.

North Carolina Expands Tax Plans

North Carolina is taking a more aggressive approach as it reshapes its gambling tax structure. Alongside raising the online sportsbook tax from 18% to 23%, lawmakers also want prediction market operators to pay a new 6% tax on trading fee revenue generated in the state. The proposal is part of a larger budget package focused on increasing gambling related tax revenue.

Lawmakers see prediction markets as an increasingly important part of the gambling ecosystem, especially as sports related event contracts continue gaining momentum. For operators, the proposal would add another layer of costs in an already challenging regulatory environment.

New Jersey Moves Forward With Tax Bill

New Jersey is also stepping up its focus on prediction markets. Lawmakers have advanced a revised bill that would place a 9% surtax on prediction market operators. Earlier versions of the legislation included stricter regulatory measures, but lawmakers later narrowed the proposal to focus primarily on taxation.

The updated bill reflects New Jersey’s growing interest in bringing prediction market operators closer to the tax framework applied to sportsbooks and other gaming businesses. As one of the country’s biggest regulated betting markets, New Jersey’s approach could influence how other states move going forward.

Pressure Keeps Building for Prediction Market Operators

These proposals add to growing pressure across the industry. Over the past several months, prediction market platforms have faced lawsuits, tax proposals, and regulatory action in multiple states. Much of the debate still centers on one key question which is should prediction markets be treated as federally regulated financial products or as gambling products overseen by states?

That question at the moment remains unresolved. One thing is becoming clear, states are becoming increasingly active in finding ways to tax and control the industry.

Taxation Becomes a Major Focus

The latest proposals show how quickly the prediction market space is changing. What was once seen as a niche part of financial markets is now drawing serious attention from lawmakers, regulators, and traditional gaming operators. For states, prediction markets represent a new source of tax revenue.

For operators, rising taxes and growing regulation are quickly becoming just as important as growth and expansion. As more states step in, North Carolina and New Jersey may be early signs of a much larger trend shaping the future of prediction markets in the U.S.

Stay tuned to UMG Gaming for more updates on prediction markets, regulation, and the latest developments shaping the future of event-based trading in the United States.