Prediction market coalition challenges Kentucky's 14.25% transaction tax
A coalition including Kalshi, Crypto.com and Polymarket has sued Kentucky over a 14.25% tax on prediction market operators’ transaction fees, according to the lawsuit. The plaintiffs argue that the levy is discriminatory and conflicts with federal law; Kentucky Attorney General Russell Coleman said his office would defend the law. Kalshi said the tax could drive users towards unregulated platforms.
The court challenge could affect the tax treatment of prediction market operators in Kentucky.