Colorado Bill to Tax Promo Bets Pushed to 2026 Legislative Session

The Centennial Sportsbooks will get to hold on to a little extra revenue in 2025.

Lawmakers in Colorado have pushed HB 1311 to the 2026 legislative session. The Senate approved Tuesday's bill, which would tax sportsbooks on promotional bets. However, amendments require it to be submitted for approval by the House, which adjourned its 2025 session yesterday. 

As a result, the bill will be on hold until the House returns for its 2026 session.

Bill Would Tax Sportsbooks on Promo Bets

If passed, HB 1311 would allow Colorado to tax online sportsbooks on promotional bets. Known commonly as “bonus bets,” this offering will enable bettors to use a bet credit to place a wager instead of their own money. 

Promo bets are a standard sportsbook marketing tool to attract new customers. The state’s sports betting law allows operators to write those bets off, but this bill would change that. 

Projections show the bill would generate over $3 million more in tax revenue.

Senate Changes Implementation Date

The Colorado Senate tagged on a few amendments to HB 1311, but the most significant was the change in the implementation date. The House had set the bill to go into effect in September, but the Senate changed that to July 2026. 

The change means that sportsbooks can protect that revenue for another year. It could also help them push for other changes to the bill or push for the House to reject it altogether.

Bill Gives Alternative to Tax Hike

Colorado continues to have one of the lowest tax rates in the country for online sports betting operators. It has helped attract many operators, especially those seeking a test market for new platforms or offerings. While there has been some talk of raising that rate, those efforts have not gathered much (if any) momentum.

With the state not seeking a flat tax hike, many sportsbook operators have been willing to accept being taxed on promo bets. While it will affect their bottom line, the damage would be far less than it would be if the rate went up. 

Colorado’s strategy could be an example for the rest of the country. Many states have been attempting to raise their tax rates,but are failing in the face of extreme pindustry pushback An alternative similar to HB 1311 could help them increase revenue without needing support for a tax hike.