Kalshi, Crypto.com, and Polymarket Sue Kentucky Over 14.25% Prediction Market Tax

According to Abcnews, Kalshi, Crypto.com, and Polymarket filed a lawsuit in state court this Friday to challenge Kentucky's newly implemented 14.25% prediction market transaction tax. The tax, passed by the Kentucky legislature in April, targets trading fees on prediction market platforms at a rate significantly higher than the state's approximately 9.75% tax on horse racing. The platforms argue the tax is discriminatory and unconstitutional. The plaintiffs contend the tax will raise compliance costs substantially and may push trading activity toward offshore platforms with weaker regulatory oversight.
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