New Jersey Legislature Advances Prediction Markets Bills in Both Chambers

Companion bills that would regulate and tax prediction markets advanced in both the New Jersey Senate and Assembly on Sunday.

Senate Bill 4447, introduced by Senate President Nicholas Scutari  and Sen. Paul Sarlo on June 11, reported from Senate Committee as a substitute for a second reading on June 28.

Assembly Bill 5336, introduced by Assemblywoman Linda Carter, was introduced on June 28 and reported out of Assembly Committee for a second reading on the same day.

While prediction markets action proliferates across the country, both chambers advancing the bills on the same day signals strong momentum.

What the bills do

Both bills establish a regulatory framework for prediction markets, which have been offering similar markets as legal New Jersey sportsbooks in the state.

Regulated operators in New Jersey are taxed at a 19.75% rate, which was passed before the end of the last fiscal year.

A5336 would tax prediction markets at the same rate, while also including a surcharge:

“Athletic events markets will be taxed at the same rate as sports wagering, plus a 10% surcharge. A 10% surcharge will also be applied to all other prediction markets, in addition to otherwise applicable business taxes and fees.”

Prediction market operators would be banned from opening positions on political markets, death markets, and catastrophic event markets.

The bills also state that operators would be required to obtain a license from the New Jersey Division of Gaming Enforcement (DGE), where age verification, responsible gambling, self-exclusion programs, deposit limits, and advertising requirements would be regulated.

Where the bills stand

Both bills are on their second reading in each respective chamber, and moving rather quickly.

S4447 advanced in just over two weeks. A5336 was introduced and reported out of committee on the same day.

New Jersey would join a growing number of states asserting regulatory authority over platforms like Kalshi and Polymarket, which have operated under federal Commodity Futures Trading Commission (CFTC) oversight while bypassing state gaming laws.

Prediction markets collected a court win in April when the Third Circuit Court of Appeals blocked the DGE from enforcing state gambling laws against Kalshi.

“Kalshi’s sports-related event contracts are swaps traded on a CFTC-licensed DCM, so the CFTC has exclusive jurisdiction.”

Despite the ruling, New Jersey lawmakers appear to be in favor of treating prediction markets as sports wagering operators.