An industry coalition including Kalshi, Crypto.com , and Polymarket has filed a lawsuit to prevent Kentucky from imposing a 14.25% tax on transaction fees for prediction platforms.
The lawsuit alleges that the tax is discriminatory, unconstitutional, and has been superseded by federal law. Kentucky's law, passed in April, applies to transaction fees that market operators anticipate collecting from users.
Earlier, Kentucky Attorney General Russell Coleman said his office would pursue the case to the end and defend state regulations. He said out-of-state companies were seeking to overturn Kentucky's sports betting laws.
It is unclear which argument the court will XEM first, while the lawsuit could directly impact how Kentucky taxes the operations of prediction platforms.
