Multiple organizations have jointly sued Kentucky for its 14.25% forecasting market tax, with Kalshi and Polymarket involved.

Odaily Planet Daily reports that an industry coalition including Kalshi and Polymarket has filed a lawsuit to block the state of Kentucky from imposing a 14.25% transaction tax on prediction markets. This tax, passed by the Kentucky legislature in April, imposes a 14.25% sales tax on transaction fees charged to prediction market operators and is considered the first state-level tax specifically targeting this industry in the United States. The plaintiff, the Fair Markets Coalition, argues that the tax is discriminatory, unconstitutional, and may already be covered by federal law. The lawsuit points out that imposing a higher tax burden on prediction markets is clearly unfair and could distort the competitive structure of the market. (Abcnews)