Louisiana Postpones the Draft Law on the Sports Betting Tax Increase

If endorsed, the proposition would have grown the betting fee to reach New York’s record-breaking US tax rate. The primary purpose is to increase state income amid a budget shortfall.

Core Provisions of the Bill

Mr Wilder’s proposal was approved by the House Ways and Means Committee on November 13th before being withdrawn.

The fundamental notions of the bill are:

• a suggestion to elevate the contribution rate to 51%;
• a prohibition on deducting promo gaming credits from sportsbooks’ taxable revenue.

Specialists estimate that raising the fee could boost Louisiana’s income to $205.3 million in the next fiscal year, compared to the current $52.2 million generated at the existing rate.

The draft law was withdrawn to include additional provisions and address several regulatory concerns. However, the revised document is unlikely to be ready for the next hearing on November 25th.

Supporters of the initiative argue that the proposal should be integrated into a broader tax reform facilitated by the Governor’s endeavours. In his opening remarks for the latest session, Jeff Landry emphasised that the current system is outdated, overloaded, and counterproductive, hindering the state's progress. Louisiana is currently dealing with a $700 million budget shortfall.

Opponents' Perspectives on the Proposal

The sphere's specialists and stakeholders have raised worries about the possible consequences of such a drastic measure. Experts argue that it could harm the competitiveness of the betting sector and push clients toward black-market suppliers.

The iDEA’s Co-Founder, Jeff Ifrah, urged Louisiana lawmakers to reconsider the tax hike proposal. He described the steep fee increase as a radical and inadequate policy move. Mr Ifrah warned that it would raise operators’ spending significantly, ultimately affecting gamblers through less favourable odds and stricter advertising limitations.

Fanatics’ VP of Government Affairs, Brandt Iden, supported the previous spokesman's criticism. He is surprised by the fact that Louisiana Republicans are backing a tax increase exceeding 300% and called the move irrational.

Louisiana has become one of the latest states to consider growing taxes on the wagering sector.

Similar proposals have been introduced in:

• Illinois (a rise to 40%);
• Ohio (an increase to 20%).