If you've been following the current Supreme Court case regarding to nationwide legalization of sports betting, you've heard the term "integrity fee." It's the leagues' way of saying, hey, if we go along with the deal, we want to be compensated. Below is a
that perfectly summarizes why that's a bad idea and won't work. To break it down in the simplest of concepts: Which would you rather lay? -110 or -125?
"In general any additional tax/fee burden on regulated operators should be considered carefully with the overall tax rates and costs for operators, in order to not prove prohibitive to be able to compete with the offshore and illegal markets where operators usually pay only low taxes or fees," adds Dr. Mintas. "If operators have to pay high taxes on their turnover/handle, pay a market entry fee and additional an integrity fee, that might put them into a situation where they cannot compete with the offshore markets, which means they cannot offer the same odds to their customers and as they offerings will be less attractive. As a consequence, people might continue to bet in the offshore market which means the percentage and taxes which the stakeholder will receive will be small while these amounts could be higher in a well regulated environment."