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Another US state is set to increase its tax on sports betting.
Louisiana lawmakers passed legislation increasing the state's tax on sports betting from 15% to 21.5%.
Louisiana Governor Jeff Landry has signed House Bill 639 into law. The legislation, now designated as Act No. 298, will take effect on August 1, 2025, according to the Louisiana State Legislature website.
The bill, authored by Representative Neil Riser, a Republican from Columbia, is expected to generate more than $24 million annually to support athletic departments at Louisiana’s top public universities.
Louisiana becomes the first state to increase taxes specifically to fund college sports following a recent federal court settlement allowing universities to directly make NIL payments to student-athletes.
Earlier this month, a federal judge approved a $2.8 billion settlement that lets colleges pay athletes directly through revenue sharing.
Some operators are fighting back and, in the end, it's the consumers that will pay the price.
Case in point, FanDuel recently announced a 50 cent fee on all bets placed in Illinois after that state increased its tax on sports betting from from a 15% flat rate to a 20% to 40% graduated range.
“Should the state reverse its decision at any point in the future, FanDuel will immediately remove the $0.50 transaction fee,” the company said.
Flutter CEO Peter Jackson noted his disappointment in the fee, which he thinks will turn some bettors toward the black market.
“It is important to recognize that there is an optimal level for gaming tax rates that enables operators to provide the best experience for customers, maximize market growth and maximize revenue for states over time,” Jackson said. “We are disappointed that the Illinois Transaction Fee will disproportionately impact lower wagering recreational customers while also punishing those operators who have invested the most to grow the online regulated market in the state.
“We also believe the introduction of the Illinois Transaction Fee will likely motivate some Illinois-based customers to bet with unregulated operators. These operators do not contribute tax revenue to the state, will not collect the newly announced transaction fee and do not offer the same levels of customer protection that regulated operators provide.”
No word yet on whether FanDuel intends to follow suit in Louisiana, where it currently maintains a license.
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