Lawmakers in Louisiana are considering a piece of legislation that aims to double the state’s tax rate on sports betting after a bill in 2024 failed to leave a House committee.
House Bill 639 was approved with a 20-1 vote on Monday by the House Appropriations Committee. The measure would amend Louisiana Revised Statutes to raise the state’s online sports wagering tax from 15% to 32.5%. The tax hike, proposed by Rep. Neil Riser, would give online sports betting and retail video draw poker devices the same rate.
Riser’s proposed tax rate increase benefits athletic departments at public universities across the state. HB 639 establishes the Supporting Programs, Opportunities, Resources, and Teams Fund (Sport Fund). The fund receives 25% of tax revenue from sports betting to support student-athletes at public NCAA Division I programs in the state.
Under HB 639, institutions receiving a portion of the proceeds include LSU, Louisiana Tech, McNeese State, Louisiana Lafayette, Grambling and Nicholls State.
According to a fiscal note, the fund is projected to receive over $31 million annually.
HB 639 calls for another 25% of tax revenue from wagering to be used to support early childhood education with 10% to be sent to local governments. The measure mandates 3% of tax revenue to be used to provide problem gambling resources and tools in the state.
Riser’s measure also requires 3% to be deposited into the Louisiana Postsecondary Inclusive Education Fund, which supports students with mental and physical disabilities.
Louisiana currently allocates 25% of tax revenue from sports betting toward early childhood education. It uses 10% to support local governments with 3% for problem gambling resources. The remaining proceeds are deposited into the state’s General Fund.
Riser’s bill is connected to another piece of legislation
The success of HB 639 depends on another piece of legislation as the House Appropriations Committee tied the measure to a bill that also proposes a tax change in the state.
House members pinned HB 639 to Rep. Chance Henry’s proposed measure to establish a flat tax rate on insurance premiums. The bill, House Bill 594, was filed earlier this month and was passed with amendments by the Committee on Ways and Means.
During the House Appropriations Committee’s vote on HB 639, the measure was only opposed by Rep. Jerome Zeringue, who has fiscal concerns regarding Henry’s flat tax.
Failed effort in Louisiana
Last year, Rep. Roger Wilder introduced House Bill 22, a measure that proposed raising the tax rate on gross gaming revenue for operators from 15% to 51%, mirroring New York for the highest online sports betting tax rate in the country. HB 22 was filed during a special tax reform session. The 20-day session was called to grow Louisiana’s economy.
HB 22 was referred to the Committee on Ways and Means before it was withdrawn.
