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It may be legal now, but don’t look to play DraftKings any time soon

Fantasy sports betting is now legal in East Baton Rouge Parish and across much of Louisiana—in 47 of 64 parishes—thanks to the passage in Tuesday’s election of a parish-by-parish ballot initiative that makes it legal to play online fantasy sports games for cash prizes.

But don’t get too excited about joining the legions of DraftKings and FanDuel players across the country just yet. There remains a lot of unanswered questions about how the games will be regulated in Louisiana, and, more importantly to bureaucrats, how it will be taxed. And it will be at least another legislative session—and possibly another election season—before those questions are answered and the state’s newest form of gambling is up and running.

“What they did with this piece of legislation and this vote is say, ‘We’ll accept this as something that is legal then we’re going to go back and see how to implement it,’” says Robert Travis Scott, president of the Public Affairs Research Council. “It’s unique Louisiana government. Once again, we made something more complicated than it needed to be.”

One of the key issues that will have to be resolved with respect to the games are how they will be taxed, says Scott, who predicts there will be attempts to tax winnings at both the state and local levels. But how will the money get to local governments?

Local governments can’t impose an income tax and because the games are played online, there’s not a physical facility like a truck stop or casino where some sort of occupancy tax or user fee could be assessed.

“If there is going to be any revenue for the locals, how is it going to be done?” Scott says. “That’s something they’re going to have to figure out.”

There’s also the issue of tracking where the games are being played, he says. If someone is playing the game on a smartphone in East Baton Rouge Parish and then travels to another parish where it’s not allowed, what happens then?

“There are a lot of issues that have to be worked out,” he says.  

On the plus side, Louisiana regulators won’t be reinventing the wheel. Online fantasy sports betting is currently legal in 41 other states. Rep. Kirk Talbot, R-River Ridge, who sponsored the legislation earlier this year that led to the vote, has said he wanted to legalize the games because they are popular and fun.

 

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