Louisiana is officially set to increase its tax on sports betting after Gov. Jeff Landry signed a bill providing college athletic departments with funding through gaming.
Landry signed House Bill 639 raising the state’s online sports betting tax rate from 15% to 21.5%. The law, which will go into effect on Aug. 1, mandates 25% of the tax revenue from sports wagering to be allocated toward a new fund. The fund, the Supporting Programs, Opportunities, Resources and Teams Fund (SPORT Fund), supports student-athletes at public NCAA Division 1 programs in the state. The institutions receiving a portion of the proceeds include LSU, Louisiana Tech and McNeese State.
Under the law, the tax revenue will be distributed to 11 college athletic departments by the Board of Regents, with the tax revenue used for a variety of men’s and women’s sports.
The tax revenue will be used to support scholarships, insurance and medical coverage and facility upgrades. HB 639 prohibits the tax revenue to be used for NIL payments to student-athletes despite a federal judge recently signing an order allowing schools to pay athletes.
In related news, after a recent court ruling, NCAA-sanctioned college and universities can begin paying athletes beginning July 1.
Landry’s signature makes Louisiana the first state to use tax proceeds from sports wagering to support college sports. The new law is expected to generate $24 million annually for college athletic departments across the Bayou State. Louisiana’s tax rate on sports wagering places it on the same level as the state’s tax on retail casino gaming.
The tax rate for retail sports wagering in Louisiana remains unchanged at 10%.
In addition to college athletic departments, HB 630 allocates tax revenue from sports wagering toward early childhood education, local governments and problem gambling.
Louisiana adds to a growing list
The Bayou State is the third U.S. market to raise its tax rate on sports betting in 2025 and joins a growing list of states that have revised tax rates since launching.
Last month, Maryland Gov. Wes Moore signed a budget to increase the state’s tax rate on online sports betting from 15% to 20%. Illinois is set to add a 25-cent flat tax on online sports wagers placed in the state after implementing a sliding scale tax rate model last year. The scale sees operators taxed up to 40% based on their adjusted gross revenue.
Lawmakers in Ohio, New Jersey and Wyoming are also considering tax rate increases.
Landry vetoes sweepstakes measure
Louisiana’s governor signed HB 639 but failed to approve a sweepstakes casino ban.
Last week, Landry vetoed Senate Bill 181 as a piece of legislation that proposed prohibiting the operation and promotion of online offshore and sweepstakes casino sites.
He vetoed the bill because he deemed it unnecessary with “overly broad” language. Landry also cited the Louisiana Gaming Control Board’s ability to make unlicensed offshore and sweepstakes casinos exit the state through the distribution of cease and desist orders.
The LCGB subsequently announced they had sent 80 cease and desist letters to operators they believe are live in the state in defiance of the law.
