Louisiana Senate approves sports betting tax hike bill
House Bill 639 passes with a 35-3 vote which will cement a new 21.5% sports wagering tax in the state, once governor gives his signature
Louisiana lawmakers have approved legislation to increase the state’s online sports betting tax rate from 15% to 21.5%.
House Bill 639, first introduced by Republican representative Neil Riser, passed through the state’s Senate with a 35-3 vote on Sunday, June 8.
The bill will now head to Governor Jeff Landry to give his signature and make the bill official state law, after it was enrolled and signed by the Speaker of the House, Phillip DeVillier.
The state’s current 10% tax rate for retail sports betting will remain unchanged despite the new legislation.
Following the 6.5 percentage point increase in the tax rate, the structure of where tax proceeds will be funnelled will also change.
As per the bill, 25% of the funds generated by the new tax rate will go towards a newly established SPORT fund (Supporting Programs, Opportunities, Resources, and Teams).
This will provide financial support to eligible universities and student-athletes, allocated towards scholarships, insurance and medical expenses, and facility maintenance.
However, Senator Stewart Cathey confirmed that no part of the fund will be used to make direct payments to student-athletes.
A further 3% of funds raised will be put towards the Louisiana Postsecondary Inclusive Education Fund.
A 21.5% sports betting tax rate will put Louisiana just above Massachusetts (20%) but still below the likes of New York at 51% and Pennsylvania at 36% in terms of commercial, competitive markets.
An early draft of the bill called for a tax rate of 32.5% before it was amended.
Louisiana follows in the footsteps of Maryland, which approved legislation increasing its sports betting tax rate from 15% to 20% last month.
Illinois also approved a new budget which will include a $0.25 charge on the first 20 million sports wagers accepted in the state each year, with the figure rising to $0.50 on all bets placed thereafter.
Louisiana has also moved closer to banning sweepstakes gaming in the state, after a bill banning the vertical passed through the Senate.