Louisiana Lawmakers Considering How to Tax Unregulated iGaming Operators

The Pelican State is at a Catch-22 with online casinos, as officials highlight benefits and risks.

Ziv Chen - News Editor at Covers.com
Ziv Chen ? News Editor
Dec 12, 2024 ? 14:55 ET ? 4 min read
Photo By - Imagn Images.

Louisiana lawmakers are considering how to tax unregulated online casino operators, which currently still draw in revenues from players in the state.

Representative Mike Echols estimated that the state is losing up to $4.6 billion in untaxed revenue annually.

Operators such as Stake and El Royale Casino are attracting customers through sites based outside the U.S. Meanwhile, Stake also operates a sweepstakes casino, Stake.us, which accepts payments from U.S. customers for online currency they can use to play casino games.

“They’re predatorily coming after our constituents and allowing them to gamble online. I don’t think our issue is with our constituents doing something, it is with these vendors,” Echols said on the unlicensed casinos in Louisiana, according to WAFB.

The benefits of legalizing Louisiana online casinos

The most significant benefit of legalizing online casinos in Louisiana would be stopping the state from losing all the taxable revenues that could benefit the community. Light & Wonder Gaming’s Howard Glaser explained that because it is easy to play at offshore casinos, it is helping Echols’ estimated $4.6 billion in yearly revenue flow out of the state.

“You can pay for some of this with a Mastercard or a Visa. You did not approve this but it is happening and is happening throughout the state,” Glaser said.

Echols proposed another benefit of legalizing mobile casinos in LA: linking revenues to existing land-based casinos through partnerships with online platforms.

States like New Jersey and Pennsylvania implement similar legislation to Echols’ proposal, requiring online casinos to collaborate with a land-based partner. For example, DraftKings Casino operates in the Garden State through an agreement. Additionally, many sports betting states put this type of restriction on online operators, including New York, Illinois, and Missouri.

Opposition to legalizing iGaming in Louisiana

Several Louisiana lawmakers have raised issues with legalizing online casinos, with primary concerns relating to encouraging rises in problem gambling and issues with age verification for casino games. 

The chair of the Louisiana Gaming Control Board, Chris Hebert, also shared his concerns, highlighting that making casino gambling easier may create more problems by encouraging higher rates of gambling.

“One thing to travel to a casino and game but it’s another thing to be able to do it from your couch. Those present real problems. As regulators that is not lost on us,” Hebert said.

Other types of gambling thriving in Louisiana

While lawmakers consider legalizing online casinos, other types of gaming continue to demonstrate growth. Even with the potential of an increase in sportsbook taxes, although this has been put on hold, the Louisiana sports betting industry continues to thrive.

Fanatics Sportsbook became the latest operator to join the Louisiana market in August, and since then, the sports betting handle has grown in August and October. Revenues may have dropped in October, but this followed a U.S.-wide trend thanks to bettor-friendly results.

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News Editor

Ziv Chen is an industry news contributor at Covers.com

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