As one of only two states in the United States without any legal form of gambling, Hawaii is making a new push on the path to legalizing sports betting. Although a related bill failed at the last minute last year, legislators have quickly submitted new proposals this year. However, this effort may face a "speed bump": a gambling expansion research group established last year is working in parallel, needing to assess various possibilities including casinos. A key data recently disclosed by the group is that the annual amount of illegal gambling in Hawaii could be as high as 800 million US dollars. This figure highlights the scale of the underground market and has become a strong argument for supporting legalization to obtain tax revenue and strengthen regulation.
Legislative background: From "almost passed" to the challenge of the research group
Last year, Hawaii's sports betting bill was passed by both the House and the Senate, but failed to reach a final version in the conference committee, stopping short. The governor had stated that he would not veto the bill if it reached his desk. This has encouraged supporters to push harder this year. However, the establishment of a "Tourism and Gambling Working Group" consisting of 24 members has added uncertainty to the legislative process. This group, comprising legislators, law enforcement officials, and industry representatives, is tasked with comprehensively studying the potential impacts of gambling expansion and is required to submit recommendations by the end of this year or early next year. Last month, the research group focused on discussing the issue of illegal gambling, and its estimated 800 million US dollars in annual illegal betting has become an important background for promoting regulatory reform.
2026 bill core: Licenses, taxes, and restrictions
The supporting bills submitted this year (SB 3303 and HB 2570) outline the preliminary framework for sports betting, with several key provisions worth noting:
•Licenses and fees: The state government will issue at least 6 sports betting licenses, with a license fee of 500,000 US dollars for the first five years.
•Tax rate: Sports betting revenue will be subject to a 15% state tax. Notably, last year's bill had a tax rate initially set at 10%, and even temporarily canceled during the review process, but ultimately failed to finalize due to disagreements between the two houses.
•Betting restrictions: The bill explicitly prohibits betting on youth sports events and events involving local universities in Hawaii.
These specific provisions will interact with the conclusions of the research group, jointly determining the final form of the legislation.
Other gambling issues: From prediction markets to cruise ship casinos
In addition to sports betting, Hawaiian legislators have also proposed several other gambling-related bills this year, reflecting the diversity and complexity of the issues:
Prohibition of prediction markets: One bill aims to prohibit prediction markets from operating within the state, triggered by previous transactions of more than 488,000 US dollars on platforms betting on the governor's annual state of the state address.
Legalization of cruise ship casinos: Another bill proposes allowing casinos on cruise ships in Hawaiian waters and imposing a 20% tax.
Specific area bans: There are even bills requiring a ban on any gambling in the planned "New Aloha Sports Stadium Entertainment District".
These numerous proposals indicate that the discussion about gambling in Hawaii is shifting from "whether to open" to "how to open" and "what forms to open" at a deeper level of gambling. The conclusions of the research group will provide crucial reference for this discussion. Whether Hawaii can successfully regulate the large underground market and obtain tax revenue will become a case worth watching on the US gambling legislation map. For global gambling legislation trends and in-depth policy analysis, please follow the PASA official website.
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