Gambling Bills That Shaped Last Week: Expansion, Illegal Gambling Crackdowns, Taxes, and Prediction Markets

Last week, some states advanced iGaming and lottery expansion, while others ramped up enforcement against sweepstakes-style offerings and illegal operators, revisited sportsbook tax policy, and drew congressional attention to prediction markets.

As the 2026 legislative session moves forward, U.S. gambling policy is increasingly splitting into two main lanes: expansion and enforcement. Maryland and Alabama took steps toward authorizing new regulated markets, Virginia and South Dakota progressed sports betting measures, multiple states moved against gray-market platforms, Illinois reexamined its per-wager tax, and Congress indicated renewed scrutiny of prediction markets.

Gambling Expansion

Maryland — House iGaming Measures Follow Senate Momentum

After Senate lawmakers introduced bills last week to legalize online casinos and authorize a voter referendum, two companion measures — HB 1343 and HB 1255 — were filed in the House this week. Initial hearings were set for March 5.

The new filings are expected, representing the fourth consecutive year lawmakers have tried to legalize online casinos.

Why it matters:

Maryland is among the largest untapped iGaming opportunities on the East Coast, positioned between established markets such as New Jersey and Pennsylvania.

Earlier proposals stalled amid resistance from land-based casinos and labor groups, but this year’s bills seek to address those objections by adjusting protections. With elections approaching and the House having approved iGaming in 2024, the push may have more momentum than in past cycles.

Alabama — House Lottery Bills Introduced

After legislation to legalize a lottery, casinos, and sports betting surfaced in the Alabama Senate earlier this month, two House bills were introduced this week to create a lottery and establish a regulator.

HB 448 would legalize the lottery at the constitutional level, while HB 449 sets up the corporation, operating rules, and revenue framework required to run and fund it.

Why it matters:

Alabama is still one of five states without a state lottery and remains one of the country’s most restrictive gambling jurisdictions. The latest House efforts suggest renewed interest this year, and because it is an election year, any constitutional amendment could ultimately appear on November’s ballot.

Even so, the one-vote Senate failure in 2024 shows how narrow the path remains, including for a lottery-only proposal.

Virginia — Multiple Gaming Bills Move Toward Senate Votes

Several Virginia gambling proposals are progressing through the Senate, addressing areas including iGaming, regulation of daily fantasy sports, skill games, and authorization of a casino in Fairfax County.

SB 118, SB 129, SB 661, and SB 756 are now all awaiting a third reading in the Senate.

Why it matters:

The rapid movement points to sustained legislative interest in expanding and fine-tuning the state’s regulated market. If they pass after the third reading, the bills will cross over to the House, a major step toward enactment.

South Dakota — Senate Clears Mobile Sports Betting Referendum

The South Dakota Senate approved a bill that would allow voters to decide whether to expand sports betting beyond Deadwood’s retail-only model to permit statewide mobile wagering.

Why it matters:

South Dakota’s current setup confines betting to physical casinos, limiting both participation and handle. Authorizing mobile wagering would significantly broaden access and could increase revenue with minimal added infrastructure costs.

Illinois — Proposal Would Repeal Per-Bet Tax

Although it is not an expansion measure, an Illinois bill would repeal the state’s controversial per-bet tax structure — a flat fee charged on every sports wager, regardless of outcome.

Why it matters:

Illinois Gaming Board data indicate that bettors placed 27.6 million fewer wagers from September through December 2025 than during the same period the prior year — after operators introduced surcharges and minimum bets in response to the tax.

Eliminating the tax would remove those surcharges and minimum-bet requirements, potentially improving wagering volume and competitiveness.

Illegal & Sweepstakes Crackdowns

Indiana — Enforcement Measure Advances Out of Senate Committee

Indiana’s broad administrative bill, which includes a provision to prohibit dual-currency sweepstakes casinos, cleared a Senate committee this week. The House passed the measure last week.

Why it matters:

The committee vote suggests the Senate is aligning with the House on closing sweepstakes loopholes. With that provision central to debate throughout the process, the bill is now one step closer to a statewide prohibition.

Florida — Companion Bills Tighten Illegal Gambling Restrictions

Two Florida measures moved closer to a floor vote this week. In the House, HB 189 now awaits a floor vote, and in the Senate, SB 1580 advanced through committee.

Both bills target illegal gambling, including storefront arcades that have been a major issue in the state. They also add provisions related to illegal online gambling, which could potentially capture sweepstakes-style platforms as well.

Why it matters:

Given Florida’s size, the state is one of the most consequential enforcement battlegrounds in the country. Stronger rules would help authorities pursue proliferating illegal storefront arcades and illegal online platforms while protecting the Seminole Tribe’s compact-backed monopoly.

Utah — Consumer Protection Approach That Could Impact Illegal Gaming

Even though Utah bans gambling entirely, SB 38 strengthens enforcement tools around deceptive trade practices and consumer protections that could be applied to disguised gaming products, including sweepstakes casinos.

The bill has already passed the Senate and advanced to a third reading in the House, leaving it just one step away from passage.

Why it matters:

States are increasingly using consumer law, rather than gaming statutes, to pursue offshore or sweepstakes operators. Utah’s model offers a legal workaround that other anti-gambling jurisdictions may seek to replicate.

Federal Spotlight: Prediction Markets

Rep. Titus, who has been the champion in reversing the new gambling loss deduction, introduced legislation to block sports-event contracts that bypass state gambling laws by asserting commodities-market status.

Why it matters:

While the measure faces a long road amid ongoing litigation, it is among the first direct congressional efforts to prevent prediction markets from sidestepping state gambling regulation.

Big Picture: Expansion vs. Enforcement

This week’s developments underscore a widening policy split in U.S. gambling regulation:

Expansion continues in states such as Maryland, Alabama, Virginia, and South Dakota, as lawmakers look to unlock new revenue, modernize betting frameworks, and capture offshore demand.

At the same time, enforcement against illegal operations accelerated from Florida to Indiana to Utah, signaling that states are no longer willing to cede market share to gray operators.

Taken together, these measures show lawmakers moving past simple legalization debates and into a more mature regulatory phase — balancing growth, tax policy, consumer protection, and enforcement in a rapidly evolving market.