Louisiana Lawmakers Okay Online Sports Betting Tax Increase

• The Louisiana Senate approved a bill to increase the state’s online sports betting tax rate
• Pending a gubernatorial signature, the state will increase its rate from 15% to 21.5%
• The House approved the bill in May

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Louisiana lawmakers approved a bill late Sunday to increase the Pelican State’s online sports betting tax rate.

The Louisiana Senate approved Rep. Neil Riser’s (R-20) bill, HB 639, by a 35-3 vote. The legislation calls for an increase to Louisiana’s online sports betting tax rate from its original 15% rate to 21.5% and creates a new fund for D-1 universities.

Louisiana is the third state in 2025 to increase its sports betting tax rate.

Leveling Online, Retail Sports Betting Tax Rate

Pending a signature from Gov. Jeff Landry (R), Louisiana’s online sports betting tax rate will be increased to 21.5%, leveling it with the state’s brick-and-mortar sports betting tax rate. Riser’s original bill included an increase for the Louisiana sports betting tax rate to 31%, but the rate was decreased after negotiations with licensed operators.

The bill never received any serious opposition as it traveled through the House or the Senate these past few months. During its final hearing in the Senate on Sunday, June 8, no questions were asked on the legislation and the bill was voted on after just five minutes of discussion.

The House approved Riser’s bill by a 73-15 vote in late May.

Louisiana is the third state this year to increase or add a substantial fee for its licensed sports betting operators. In late May, Maryland lawmakers agreed to a state budget that included an increase to the state’s sports betting tax rate from 15% to 20%.

Gov. Moore, Senate President Bill Ferguson (D-46), and House Speaker Adrienne A. Jones (D-10) announced the framework for the state’s proposed $67.3 billion 2026 budget in March. The budget included agreed-upon cuts of nearly $2.3 billion and included more than $1 billion in new revenues.

However, Moore’s version of the budget he introduced in January included an ever larger increase to Maryland’s sports betting tax rate. Moore originally proposed an increase to 32% for the state’s rate.

Lawmakers settled on a 20% compromise.

Also, last week Illinois lawmakers approved the state’s fiscal year budget which includes a $0.25 fee on each of an operator’s first 20,000,000 bets and a $0.50 per bet thereafter.

The new fee will result in some of the highest sports betting tax rates in the country for licensed operators that do the most business in the state.

According to a report from the Chicago Tribune, the new fee is expected to bring in $36 million annually to the state, but will result in FanDuel and DraftKings – likely the only two operators to eclipse the 20,000,000 bet threshold – paying a tax rate equivalent of 57% to 60% when the fee is instituted.

Operators that do not cross the 20,000,000 bet threshold will likely see an equivalent 12.5% increase to the tax rate they are required to pay.

New Louisiana Athletic Fund

Included in Riser’s legislation is the creation of the Supporting Programs, Opportunities, Resources, and Teams Fund (SPORT Fund), which will see sports betting tax revenues invested into the state’s D-1 university athletic departments.

The fund will receive 25% of the state’s sports betting revenues. Money will be earmarked for Louisiana university’s for the purpose of scholarships, insurance, medical coverage, facility enhancements, litigation settlement fees, and Alston Awards.

Under the terms of the bill, the following institutions will be eligible to receive revenues from the new fund:

• Grambling
• LSU
• Louisiana Lafayette
• Louisiana Tech
• McNeese State
• Nicholls State

Sen. Stewart Cathey Jr. (R-33), a co-author of the bill, praised the universities for agreeing to take equal portions of the fund. He also assured his colleagues that no money will be allowed to fund student athlete compensation, such as NIL.