Gov. Jeff Landry signed off on a tax increase on sports betting in Louisiana, raising the rate to 21.5% from the current 15%.
Louisiana sports betting brought in around $65 million last year, almost double the $32.6 million in 2023. The additional tax is estimated to generate a further $24 million annually.
Colleges to benefit from new distribution
The increase is set to benefit the state’s colleges with 25% of tax revenue directed to a new Supporting Programs, Opportunities, Resources and Teams (SPORT) fund.
The bill’s sponsor, Rep. Neil Riser, commented on the decision to redistribute the funds, “We love football in Louisiana – that’s the easiest way to say it.”
He went on to add, “Without the athletes, we wouldn’t have the revenue. I just felt like it’s fairness that we do give something back.”
Riser has initially proposed a new rate of 31.5%, but after discussions in the Senate, the new rate of 21.5% was voted 73-15 in favor in the House, and 35-3 in the Senate last week.
A federal judge last week also paved the way for more funds to go to college athletes. U.S. Judge Claudia Wilken approved a proposal that will allow each school to share up to $20.5 million with athletes over the next year and $2.7 billion that will be paid over the next decade to thousands of former players who were barred from that revenue for years.
More money should fund problem gambling
Not everyone agrees on the policy to direct funds towards college athletes, however. Peter Robins‑Brown of Louisiana Progress, a non-profit advocating for progressive policy and empowering working-class communities in Louisiana, believes the funds should address problems created by gambling .
Robins-Brown stated, “Legalized mobile gambling has created or exacerbated many social and cultural problems,”
“New tax revenue should be used first and foremost to address some of those problems before we talk about spending more money on college sports.”
The redistribution of funds will see 3% directed towards problem gambling initiatives, compared to the current 2%.
Landry opts not to veto this time
Despite another bill on betting passing unanimously in both chambers, Landry vetoed the legislation, which would have banned sweepstakes casinos. Lawmakers had argued that the bill would protect state tax revenue from regulated gambling, but Landry believed it had the danger of reducing the power of the Louisiana Gaming Control Board.
In a sign that the Board still maintains control over gambling in the state without the legislation, it announced 40 cease-and-desist letters to a range of offshore betting companies and sweepstakes operators this week.
Tax in line with national average
The rate of 21.5% is just above the average of 19% across the US. Other states are also increasing the rates, so the average is also likely to increase soon. Notably, Illinois introduced a tax on every bet to the dismay of sportsbooks in the state. In response, DraftKings and FanDuel have introduced a betting surcharge in the state, passing on all the additional costs to consumers.
Other states have been making more modest increases, similar to Louisiana. Maryland’s governor signed off on a bill raising the rate from 15% to 20%, while a bill in Wyoming also proposes to raise the rate up to 20% from the current 10%.
Adam is an experienced writer with years of experience in the gambling industry. He has worked as a content writer and editor for five years on sites such as Oddschecker, CoinTelegraph and Gambling Industry News, bringing excellent knowledge of the world of sports betting and online gambling. Adam focuses on emerging stories in the ever changing landscape of betting in the US. Read the latest on prediction markets, changing legislation, and sweepstakes.
