Louisiana Gov. signs bill increasing online sports betting tax to 21.5%

Louisiana Governor Jeff Landry has signed House Bill 639 into law, raising the state’s online sports betting tax rate from 15% to 21.5%. The legislation, now designated as Act No. 298, will take effect on August 1, 2025, according to the Louisiana State Legislature website.

The bill, authored by Representative Neil Riser, a Republican from Columbia, is expected to generate more than $24 million annually to support athletic departments at Louisiana’s top public universities.

The move comes after, earlier this month, a federal judge approved a $2.8 billion settlement that lets colleges pay athletes directly through revenue sharing. In the first year, each Division I school can share up to $20.5 million with its athletes.

The settlement also continues to allow college athletes to receive name, image, and likeness (NIL) money from third parties, such as donor-backed collectives that support specific schools. While state tax money won't provide direct NIL payments to athletes, it could facilitate that indirectly by freeing up other university resources.

One-quarter of the tax revenue generated will be split equally amongst the state’s 11 Division I public universities to support student athletes. This includes funding for scholarships, insurance, medical care, facility upgrades, settlement costs, and Alston awards. The majority of the remaining money will go to the state’s general fund.

According to the Associated Press, this makes Louisiana the first state to increase taxes specifically to fund college sports following the recent federal court settlement allowing universities to directly make NIL payments to student-athletes.

The tax revenue will benefit schools competing at the NCAA Division I level, including Louisiana State University (LSU), University of Louisiana at Lafayette, University of Louisiana at Monroe, Louisiana Tech, Grambling State, McNeese State, Nicholls State, Northwestern State, Southeastern Louisiana, Southern University, and the University of New Orleans.

“We love football in Louisiana – that’s the easiest way to say it,” Riser told the Associated Press. Earlier this year, Arkansas became the first state to waive income taxes on NIL payments made to athletes by higher education institutions.

Governor Landry signed the bill on June 11, just one day before the end of the 2025 legislative session at the State Capitol in Baton Rouge. However, the legislative website confirmed the signing earlier this week, though as of Tuesday afternoon, June 17, the governor’s official website had not yet reflected the update.