Louisiana lawmakers have sent legislation that hikes the state’s sports betting tax rate to Gov. Jeff Landry, who is expected to sign the measure into law.
House Bill 639 received overwhelming approval from both sides of the Louisiana State Legislature. It first passed the House 74-16 in May before the Senate approved it by a 35-3 vote on Sunday.
The legislation, sponsored by Rep. Neil Riser (R-20), raises the tax rate on Louisiana sports betting from 15% to 21.5%.
One-fourth of tax revenue from sports wagering will be allocated to the Supporting Programs, Opportunities, Resources and Teams (SPORT) Fund to aid student-athletes at in-state schools and universities.
Schools could collect just under $2M a year
Louisiana’s impending change would net the state about $77 million from sports betting each year. SPORT could see just under $20 million annually.
Each of the state's 11 public institutions competing at the Division I level would collect around $1.8 million.
Schools that would receive contributions from the fund include:
- Grambling State University
- Louisiana State University
- Louisiana Tech University
- McNeese State University
- Nicholls State University
- Northwestern State University
- Southeastern Louisiana University
- Southern University and A&M College
- University of Louisiana at Lafayette
- University of Louisiana Monroe
- The University of New Orleans
SPORT funding could be used to pay for scholarships, insurance, facility and stadium upgrades, and anything else related to the Athletics Department. It cannot, however, be used to pay student-athletes under NIL.
The $1.8 million amount might not be much to a powerhouse institution such as LSU, but it could have a significant impact at smaller programs like UL-Monroe, which had a budget of about $21 million during the 2024-25 fiscal year.
The bill received bipartisan support due to its focus on improving the public education experience in Louisiana. Having more money to spend on athletics could also entice more students, including those paying out-of-state tuition, to get their degrees from Louisiana schools.
Revamping the local gaming market
The bill originally called to raise the tax rate to 32.5%, which would have put Louisiana in the top tier of US states with highest tax rates on sports betting.
A fiscal note submitted in May projected an extra $6.2 million in annual tax contributions from sports betting if the bill becomes law.
As pointed out by Legal Sports Report, Louisiana legislators also considered online casino legalization during this session. Rep. Mike Echols (R-14) noted that the state is losing out on taxes from an estimated $4.6 billion annually to the illegal online casino market.
Nefarious gambling platforms can also be involved in other crimes, Light & Wonder's Howard Glaser told a House committee.
“There are well-documented connections between illegal online gaming taking place in the state and the money that comes from it for money laundering, for drug trafficking, and for organized crime.”
Louisiana earlier this month passed a prohibition on sweepstakes casinos, which is also pending Landry’s signature.
The state is one of several that recently raised or proposed raising their sports betting tax rates. Illinois made noise last week by adding a $.25 to .50 per-bet tax to its 20% to 40% tax on sports betting. That prompted FanDuel to institute a $.50 surcharge on all bets from its customers.
Ohio, New Jersey, and Indiana also recently considered increases. Maryland earlier this year raised its rate from 15% to 20%.