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Louisiana lawmakers deliberate amended betting tax proposals


Louisiana Representative John Stefanski has amended his bill to establish a tax rate for online and mobile sports betting in the state. 

Stefanski’s House Bill 688, which appears to replace his previous proposal HB 628, sets a $250,000 application fee for a sports betting license. 

A $500,000 fee would then be payable upon receipt of the five-year license itself. 

For platform providers, third parties that are contracted to operate sports betting on behalf of the licenseholders, a $100,000 application fee will be followed by a $250,000 license fee. 

Service providers, meanwhile, are to pay $10,000 for their application under Stefanski’s bill, then a  further $12,500 should they secure a permit. Sports wagering distributors, which appears to refer to affiliates, will be charged a $5,000 application fee, followed by $2,500 for their certification. 

All fees generated would be paid into the Sports Wagering Enforcement Fund, with this money to be used invested similar to that allocated to the Louisiana General Fund. 

Sports betting licensees would then be subject to different tax rates for retail and mobile betting. For in-person wagering, a 10% levy would be applied to gross revenue, while this would almost double, to 18%, for mobile. 

Tax revenue will be deposited in the state’s Bond Security and Redemption Fund. 

The fees and tax rates set out by HB 688 are significantly lower than those outlined in Stefanski’s HB 628, which would have set a $1m application fee, and a $500,000 license fee, for sports betting. Platform providers, however, would have been subject to a lower fee, paying $100,000 for applications, then $50,000 for licenses. 

The tax rate would have also been significantly higher. In-person revenue would have been taxed at 15%, which would have doubled to 30% for mobile. The Louisiana Lottery Corporation, meanwhile, would have been subject to a 40% gross revenue tax. 

Whether or not the lottery gains the right to offer sports betting remains up for debate, with competing proposals filed in the Louisiana Senate. 

Senate Bill 202, filed by Senate President Patrick Cortez, would allow it to compete in the market. Also eligible under Cortez’s proposal would be Harrah’s New Orleans, the state’s only commercial casino which is to be rebranded as Caesars New Orleans, as well as its 15 riverboat casinos and four horse racing tracks. 

If any of these properties do not apply for a licence by January 1 2022, remaining licenses would be made available to establishments licensed to offer video poker, and fantasy sports operators. Each would be limited to a single skin per licensee.

A rival proposal from Senator Cameron Henry would leave the lottery out of the market, with licenses only available to Harrah’s New Orleans, the 15 riverboat casinos and four racetracks. 

A parish-by-parish referendum, that took place in November 2020, paved the way for the deliberations on sports betting. This saw voters in 55 of the state’s 64 parishes back legal wagering, with the poll facilitated by a bill filed by Henry.