Margaritaville Casino Wins Dispute Over Free Room Tax

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Two casinos near Shreveport, Louisiana, owned by Penn Entertainment Inc. - Margaritaville Resort Casino and Boomtown Casino & Hotel - won a ruling from the Louisiana Board of Tax Appeals that they do not have to pay $6.67 million in sales and occupancy taxes on the free rooms they provide to patrons. The tribunal determined the rooms are not taxable since the casinos don't require anything in return from guests, contrary to the local tax statutes.

Why it matters

This decision provides a significant tax savings for the two casinos and sets a precedent for how complimentary rooms at gaming establishments are treated under Louisiana's sales and occupancy tax laws. It highlights the ongoing tensions between casinos and state/local governments over tax policies that impact the profitability of gaming operations.

The details

The Louisiana Board of Tax Appeals ruled that the free rooms provided by Margaritaville Resort Casino and Boomtown Casino & Hotel, both owned by Penn Entertainment Inc., are not subject to the state's sales and occupancy taxes. The casinos argued the rooms are provided without any required consideration from guests, which is a key criteria for the rooms to be considered taxable under the local tax statutes. The tribunal agreed, determining 'the mere hope or expectation that a Patron will gamble during the Comp stay does not rise to the level' of the required consideration.

• The Louisiana Board of Tax Appeals released its opinion on February 20, 2026.