Louisiana is considering a drastic change to its sports betting tax landscape during a special legislative session. Rep. Roger Wilder (R-71) has introduced HB 22, proposing to increase the state's sports betting tax rate from 15% to 51% and eliminate operators' ability to deduct promotional credits.

Key Points:

• The proposed 51% rate would match New York's as the highest in the country
• Bill requires two-thirds majority approval in both House and Senate
• Ways and means committee hearing scheduled for November 13
• Would prohibit deducting promotional play from taxable revenue

Potential Financial Impact:

• FY 2023/2024: Current system generated $52.1M in tax revenue (15% rate)
• Under proposed system: Could generate $205.3M based on same revenue
• Current gross revenue: $358.2M
• Promotional deductions that would be eliminated: $44.35M

Industry Response: Jeff Ifrah, iDEA co-founder, warns the increase could:

• Undermine legal operators' competitiveness
• Lead to less favorable odds for consumers
• Reduce promotional opportunities
• Push operators to exit the Louisiana market

Context: Illinois recently implemented a tiered tax system (July 2024):

• 20% on revenue up to $30M
• 25% on $30M-$50M
• 30% on $50M-$100M
• 35% on $100M-$200M
• 40% on revenue over $200M

The bill's success could significantly impact Louisiana's sports betting market, potentially increasing state revenue but risking operator exodus and market destabilization.

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