Louisiana's Online Sports Betting Tax Rate Set to Increase: What You Need to Know
Louisiana approves tax hike for sports betting revenues
Get ready, sports fans in Louisiana! Your online sports betting tax rate is about to go up, and it's all thanks to Rep. Neil Riser's House Bill 639. This bad boy is expected to become law once Gov. Jeff Landry signs his name on the dotted line.
But what exactly does this mean for you? Well, the current tax on online sports betting will increase from a measly 15% to a more robust 21.5%. Sounds like a significant jump, right? You're not wrong. And it's not just Louisiana that's hopping on this tax increase bandwagon. Maryland and New Jersey have been tinkering with their tax numbers lately as well.
Now, let's talk about the cash. Lawmakers are hoping that this increase will bring in an extra $77 million per year. About $20 million of that sweet, sweet revenue will find its way into the Supporting Programs, Opportunities, Resources, and Teams (SPORT) Fund. Most of the money will go towards state and sports initiatives, but there's been a little controversy over the lack of funding for groups affected by gambling addiction.
Critics argue that more money should be allocated to combat the negative effects legalized gambling has had, particularly on working-class and marginalized communities. Peter Robins-Brown, executive director of Louisiana Progress, had this to say: "New tax revenue should be used first and foremost to address these problems before we talk about spending more money on college sports."
More Money for College Sports or Problem Gambling Prevention?
Robins-Brown is concerned that mobile gambling has aggravated numerous social and cultural issues, leading to domestic violence, bankruptcies, and addiction. He believes that the new revenue should be used to address these problems before discussing expenditures on college sports.
Interestingly, lawmakers outside the United States have also been shaking down the sports betting industry for more dough. In Brazil, for instance, an unpopular tax on financial transactions was scrapped, and instead, a new levy was imposed on the sports betting industry.
Here's a quick run-down of where the new Louisiana sports betting revenue will likely go, assuming the bill becomes law:
- Supporting Programs, Opportunities, Resources, and Teams (SPORT) Fund: 25% or about $20 million will go to the SPORT Fund, benefiting NCAA Division I athletic programs across Louisiana.
- Early Childhood Education Programs: 25% of the revenue will be dedicated to early childhood education.
- Local Governments: 10% will go to local governments.
- Gambling Addiction Treatment and Inclusive Postsecondary Education: Both will receive 3% each of the revenue.
- State General Budget: The remaining funds will help address a projected budget deficit.
Stay tuned, folks. We'll keep you updated on Govern Landry's decision. Whether you're a sports enthusiast or a concerned citizen, this is one piece of legislation worth keeping an eye on.
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Enrichment Data Source:
- Louisiana House Bill 639
- Louisiana Online Sports Betting Tax Increase Comes as State Revenue Plummets
- Louisiana Sports Betting Bill: Revenue to Support NCAA Athletics, Early Education, and More
- Louisiana Governor Jeff Landry to Sign Sports Betting Tax Bill
- Louisiana Sports Betting Tax Proposal Highlights State's Budget Plight
- The proposed House Bill 639 in Louisiana, if signed by Governor Jeff Landry, will increase the tax rate on online sports betting from 15% to 21.5%, mirroring similar tax adjustments in Maryland and New Jersey.
- Critics like Peter Robins-Brown, executive director of Louisiana Progress, question the distribution of new revenue, arguing that resources should first address the growing issue of gambling addiction before funding college sports.
- Should the bill become law, the new revenue from Louisiana's online sports betting tax increase could result in $77 million annually, with 25% allocated to the Supporting Programs, Opportunities, Resources, and Teams (SPORT) Fund, and 25% directed towards early childhood education.
- In this new financial landscape of online sports betting, both domestic and international governments grapple with the potential tax revenue from the industry, as exemplified by Brazil's decision to impose a levy on sports betting instead of their previous unpopular tax on financial transactions.
