What Will Louisiana Online Gambling Taxes Mean for the State?
With 13 of the state’s 20 casinos applying for betting licenses in Oct. 2021, Louisiana is in a race to implement SB 247. Gov. John Bel Edwards signed the bill into law on June 22, making sports betting legal.
A crucial part of the state’s sports betting law is tax. Two separate bills, SB 142 and HB 697, outline the levies licensed operators have to pay and the organizations that will benefit from legal sports betting in Louisiana.
Based on Louisiana’s gambling tax rates and population, the state could benefit to the tune of $37 million every year. How will that money be collected and where will it go? Here are the fundamentals of sports betting taxes in Louisiana.
Louisiana Gambling Taxes
Louisiana’s gambling tax rate varies depending on where the money comes from. Specifically, brick and mortar casinos and racetracks offering in-person bets will pay 10% tax on any sports betting profits. Louisiana online sportsbooks will pay 15% tax.
All potential licensees will be required to pay an initial application fee of $250,000. Legal sports betting operators in Louisiana will also have to pay annual fees amounting to $500,000 over five years.
Louisiana Sports Betting Revenue and Tax
Sports betting has strong potential in the Bayou State. Twenty Louisiana casinos can apply for a state sports betting license. Other retail gambling operators and video poker venues will be able to apply for any licenses not claimed by the state’s casinos. Finally, online and mobile sports betting will be legal in the state.
Based on these conditions, plus the fact Louisiana has a population of 4.7 million, sports betting revenue could top $200 million. New Jersey provides a guide as to what’s possible. The Garden State has twice the population of Louisiana, but its gambling tax rates are similar. As of 2021, New Jersey’s state coffers benefited to the tune of $75 million a year. Based on this, sports betting in Louisiana could generate $37.5 million in tax revenue.
Gambling Profits Distribution
Where will the money from gambling in Louisiana go? There are rules. As per SB 142, taxes will fund the following organizations and initiatives:
- Early Childhood Education Fund.
- Problem gambling charities.
- Local governments schemes (in areas where sports betting is allowed).
- Disability services and other worthy causes.
Finally, any winnings that aren’t claimed within six months will be taken by the state and used to cover the cost of forensic medical exams and DNA analysis in criminal rape cases.
Potential for All with Legal Sports Betting in Louisiana
Legal sports betting in Louisiana will create a lucrative revenue stream for the state. This, in turn, will benefit local charities and organizations.
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