This month will be the second that sports betting is legal in Pennsylvania. And while returns for the state have been good for the highly taxed activity, the wide-reaching problems sports betting has had in the United Kingdom should have state lawmakers paying attention.

According to data released by the state’s Gaming Control Board, casino-housed sports books did $16 million in business, collecting $2 million in revenue and sending more than $700,000 in taxes to the state in December.

The state’s high tax rate – more than 36 percent on sports betting – had some experts predicting bookies would take their business elsewhere. Truth is, even with that tax rate, there’s too much money to be made on the practice. As news this month continues to track other state casinos adding sports books to their portfolios, that monthly tally will likely continue to grow.

While state lawmakers who supported the bill will likely tout the prospect of all that revenue coming in, they should pay attention to a growing campaign in the U.K. that has documented widespread social ills linked to sports betting.

In the U.K., sports betting was largely deregulated in 2005. Since then, it has taken over the country’s biggest sport: soccer. Betting companies sponsor the jerseys of dozens of clubs in the country and kiosks to place online bets are located in stadiums. Online betting is normal and widespread with apps and advertising everywhere one looks.

According to the Guardian, a leading U.K. newspaper, U.K. citizens lost 14.4 billion pounds – $18.78 billion dollars – in bets placed between April 2017 and March 2018, an increase of almost 13 percent from the year before. It’s an astounding total for a country with one-fifth the population of the U.S.

In its reporting on sports betting this month, the Guardian interviewed Dr. Darragh McGee of the University of Bath, who spent the last two years conducting a study of young soccer fans in Derry and Bristol. McGee found that gambling had overtaken the lives of many young men in the study. Most of the fans told him they couldn’t even watch a match without placing bets on the outcome. One subject had sunk as far as to have taken up dealing drugs to recover his family’s savings and to try and pay high-interest loans he had taken out to cover his losses.

“Far from being the knowledge-based, risk-free activity it is marketed as, the profound appeal of online sports gambling has had dire consequences for many young men,” McGee’s research concludes.

Pennsylvania has a long way to go before sports gambling becomes as pervasive as it is in the U.K., but we’d do well to pay attention to how deregulation has fared across the Atlantic. While the business of sports betting may bring in tax revenue, it comes with the knowledge that every dollar earned was lost by someone who might not have been able to afford it.

And that’s going to cost us.

Pete Mazzaccaro

...