Louisiana Senate Nears Vote on Mobile Sports Betting Tax Hike to 21.5%

Senate Showdown Looms

Sponsored by Rep. Neil Riser, the bill cleared the House on May 20 with a 73-15 vote and now awaits Senate approval before the legislative session ends on June 12.

The tax hike, scaled back from an initial 32.5% after industry pushback, aims to plug a $338.9 million budget gap in 2026. But HB 639’s fate hinges on another bill, HB 594, which sets a flat insurance premium tax and also passed the House.

Louisiana’s mobile sports betting, legal since 2022, generated $65 million in taxes in 2024. The proposed 21.5% rate could add $35 million annually, per state estimates.

Unlike retail betting, taxed at 10%, mobile wagering’s growth makes it a prime target for revenue without hiking income or sales taxes.

The bill allocates 25% of the new revenue to the Supporting Programs, Opportunities, Resources, and Teams (SPORT) Fund for college athletics, covering scholarships and facilities. Another 3% supports students with disabilities in higher education, with the rest bolstering early education and local governments.

Industry and Legislative Pushback

The original 32.5% proposal sparked fierce opposition from operators like FanDuel, who argued it would curb bonuses and drive bettors to illegal sites. Negotiations led to the 21.5% compromise, but the bill’s link to HB 594 adds uncertainty. Senate fiscal analysts are still refining revenue projections, which could sway the vote.

Louisiana’s move echoes recent tax hikes elsewhere. Illinois, facing a $1 billion deficit, added a per-bet fee of 25 cents on the first 20 million wagers and 50 cents thereafter, passed in a frenzied May 31 budget sprint. The fee, expected to yield $36 million yearly, hit operators like DraftKings hard.

Louisiana’s 21.5% rate, while less punitive, could still squeeze sportsbooks’ margins, especially after a 15-month low in profits in March 2025.

If the Senate passes HB 639 and HB 594, Gov. Jeff Landry’s signature could lock in the tax hike by July. Failure of either bill kills the plan, leaving Louisiana’s budget short. The Senate’s vote, set for June 8, will test bipartisan support amid pressure to fund education and sports without broader tax increases.