New Tax Aims to Boost Education and Athlete Support
Louisiana Governor Jeff Landry has officially signed legislation increasing the state’s sports betting tax from 15% to 21.5%. The new rate is expected to generate an additional $24 million annually, building on the $65 million collected in 2023—nearly double the $32.6 million recorded the year before.
A notable portion of the new revenue will go to Louisiana’s educational institutions. Specifically, 25% of the collected taxes will fund a newly created SPORT (Supporting Programs, Opportunities, Resources and Teams) initiative aimed at bolstering college athletic programs.
State Representative Neil Riser, who sponsored the bill, emphasized the importance of reinvesting in college sports, stating, “Without the athletes, we wouldn’t have the revenue.” Although Riser originally proposed a higher tax rate of 31.5%, the final compromise of 21.5% passed with strong legislative backing—73-15 in the House and 35-3 in the Senate.
Colleges and Athletes Set to Receive Direct Support
The tax hike coincides with a federal ruling from U.S. Judge Claudia Wilken that enables colleges to share up to $20.5 million per year with athletes. Over the next decade, former college players who were previously excluded from revenue sharing could also benefit from a $2.7 billion compensation plan.
Concerns About Gambling Harm Spark Debate
While the allocation of tax funds toward collegiate sports has received praise, not all stakeholders agree with the approach. Peter Robins-Brown of Louisiana Progress has voiced concern, arguing that funds should prioritize the social impact of legal gambling.
“Legalized mobile gambling has created or exacerbated many social and cultural problems,” Robins-Brown said. He advocates for increased investment in responsible gambling measures before expanding support for college sports.
As part of the tax adjustment, funding for problem gambling programs will rise from 2% to 3% of the total tax revenue.
Sweepstakes Ban Vetoed Amid Regulatory Actions
Governor Landry recently vetoed a separate bill that aimed to prohibit sweepstakes casinos, despite unanimous legislative support. The decision was driven by concerns that the measure could undermine the authority of the Louisiana Gaming Control Board. To reinforce its oversight, the Board issued 40 cease-and-desist letters this week to offshore sportsbooks and sweepstakes operators.
Tax Rate Aligns with National Trends
At 21.5%, Louisiana’s new sports betting tax now sits slightly above the national average of 19%. Other states are also raising rates. Maryland recently approved an increase from 15% to 20%, while Wyoming is considering a move from 10% to 20%.
In Illinois, where a per-bet tax has been introduced, major operators like DraftKings and FanDuel have responded by passing costs onto bettors via a surcharge. As more states adjust their tax strategies, the national average is expected to rise.
