New Bill Would Tax Prediction Markets In Pennsylvania
David Genge Published 13/05/2026
A new bill before the Pennsylvania General Assembly proposes that state taxes and regulatory controls apply to all prediction market sites operating in the Keystone State. Democrat Rep. Danilo Burgos introduced Pennsylvania House Bill 2497 (HB 2497). The bill seeks to create a comprehensive regulatory and tax framework for event outcome-prediction wagering in the state.
This bill figures to be a contentious issue. Prediction markets are federally regulated by the Commodities Futures Trading Commission (CFTC). To date, the federal government has battled any attempts by state governments to regulate prediction market sites. They've even been willing to go to court to do so.
The Pennsylvania bill goes into specific detail about the regulation of prediction markets
Pennsylvania lawmakers are painstakingly outlining how prediction markets would be licensed, regulated, and taxed in the state. The list of details contained in HB 2497 runs deep.
The bill is proposing a $1 million annual licensing fee for all operators. Renwal fees would also be set at $1 million. There would also be a 22% state tax on gross gaming revenue.
Oversight of the prediction market industry would be carried out by the Pennsylvania Gaming Control Board (PGCB) and the Department of Revenue. Any form of insider trading would be considered illegal. The legislation would implement anti-manipulation safeguards. The legal age to play an event contract on a prediction market site would be set at 21 years old. Currently, most prediction market sites allow players as young as 18.
The bill was introduced late last week. It has been referred to the House Gaming Oversight Committee. It has not been put on the schedule for a hearing.
“The General Assembly finds and declares that a regulatory framework at the state level for event outcome prediction wagering is necessary, in light of the adoption of a noninterference approach by the Commodity Futures Trading Commission, to regulate prediction markets,” Burgos wrote in the bill.
HB 2497 doesn't appear to have any bipartisan backing. Along with prime sponsor Rep. Burgos, the bill's 11 co-sponsors are also Democrats.
It seems unlikely that the CFTC will accept these terms
Based on what's taking place in other states where state governments have sought to flex their muscles and regulate prediction markets, Pennsylvania lawmakers could soon find themselves with a fight on their hands.
The federal government has been steadfast in its belief that state law can never supersede federal law. And since prediction market sites are already under federal regulation from the CFTC, it's been the contention of the feds that state laws don't apply to them.
Late last month, PGCB executive director Kevin F. O’Toole wrote a comment letter to the CFTC. In the letter, he called out the prediction markets for being nothing more than sportsbooks when they offer sports event contracts.
“To be clear, the PGCB believes that prediction markets offering the ability to purchase a contract on the outcome of a sporting event is sports wagering," O'Toole wrote. “The board further believes a DCM dressing these wagers up as financial instruments does not pre-empt state gaming or criminal law.”
A court battle could be in Pennsylvania's future
The federal government is already battling court cases in several states where attempts to regulate prediction markets have taken place. New York, Wisconsin, and Nevada are just three states battling in court regarding prediction market sites.
Pennsylvania could be next on that list.