Louisiana Online Sports Betting Tax Increase Incoming After Bill Passage

Late this past Sunday, lawmakers in Louisiana passed a bill to increase the online sports betting tax rate.

The bill, HB 639, came from Rep. Neil Riser. It passed with a 35-3 vote.

Now, taxes will increase from 15% to 21.5%, and a new fund will be created for all Division I universities.

With this bill passing and the taxes increasing, Louisiana is now the third state in 2025 to increase its taxes on this online industry.

Louisiana, Maryland, and Illinois Update Sports Betting Tax Law

Assuming Louisiana Governor Jeff Landry signs this bill into law, the 21.5% tax rate will fall in line with what's asked of retail sportsbooks. The original bill called for a 31% tax rate, but it was reduced following negotiations with state operators.

There was very little pushback on this bill throughout the process. In fact, during the final hearing, no questions were asked regarding the bill, and voting was conducted after just five minutes of discussion.

In May, the House approved the bill with a 73-15 vote.

As mentioned, Louisiana is the third state this year to do this.

In May, Maryland increased its tax rate from 15% to 20%.

Maryland Governor Wes Moore, Senate President Bill Ferguson, and House Speaker Adrienne A. Jones announced the framework of the proposed 2026 budget in March, worth $67.3 billion. That budget also included cuts of about $2.3 billion and about $1 billion in new revenues.

That said, the budget Moore introduced in January included an increase in sports betting tax. He originally proposed it to be 32%, but after negotiations, it went down to 20%.

In addition to Maryland, Illinois did the same thing, but in a much different way.

Now, there's a tax on each wager. For the first 20,000,000 bets, it's $0.25 per wager. From there, it's $0.50 per bet.

That will likely result in some of the highest taxes on sports betting in the country and could dramatically alter how operators function in the state.

The Chicago Tribune had a report that the new changes could result in $36 million annually, but top operators like FanDuel and DraftKings could be taxed upward of 60%.

For those that fall under the 20,000,000 bet threshold, the tax increase is probably closer to a 12.5% increase.

The New Louisiana Program Supporting Division 1 College

With Riser's bill passing, a new fund is created for Division I universities.

But what does it include?

First off, the fund is called the Supporting Programs, Opportunities, Resources, and Teams Fund (SPORT Fund). It'll see sports betting tax revenues be invested into Division I athletic departments.

The fund will get 25% of the state's sports betting revenues. This money will be used for things like insurance, scholarships, medical coverage, and more.

The colleges that'll be eligible for this include the following: Grambling, LSU, Louisiana Lafayette, Louisiana Tech, McNeese, and Nicholls State.

It's important to note that Sen. Stewart Casey, a co-author of this bill, made sure to mention that none of this money will be used for things such as NIL.

We'll see how these new tax laws impact sports betting in these states, as more states are likely to begin increasing these tax rates.