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Fantasy Sports Games

Act 1075 imposes a special 8% privilege tax based on the game operator’s gross paid fantasy sports game revenues collected on a quarterly basis.  The gross paid fantasy sports game revenues are the total of all entry fees that a game operator collects from all game participants, less the total of all sums paid out as prizes to all game participants.  The remaining balance of revenues is multiplied by the location percent for Arkansas.  The location percentage is determined for each paid fantasy sports game and calculated as a percentage of all entry fees collected from game participants located in Arkansas divided by the total of entry fees from all game participants.  The special 8% privilege tax is remitted to the Department of Finance and Administration on a quarterly basis, through the Arkansas Taxpayer Access Point. 

Game Operator is a person who is engaged in the business of professionally conducting paid fantasy sports games for cash prizes for members of the general public and requires cash or cash equivalent as an entry fee to be paid by a member of the general public who participates in a paid fantasy sports game.

Game Participant is an individual who participates in a paid fantasy sports games offered by the game operator. 

Paid Fantasy Sports Game means any fantasy sports game or contest that meets the following conditions:

• The values of all prizes and awards offered to winning game participants in public contests are established and made known to the game participants in advance of the game or contest
• All winning outcomes reflect the relative knowledge and skill of the game participants and are determined predominately by accumulated statistical results of the performance of individual athletes in actual sporting events
• A winning outcome is not based on the score, point spread, or performance or performances of any single team or combination of teams or solely on any single performance of an individual athlete or player in any single event 
• The statistical results of the performance of individuals not based on college or high school sports or on horse racing or greyhound racing
• A fantasy sports game participant is not permitted to select an athlete through an automatic draft that does not involve any input or control by the paid fantasy sports game participants or by choosing preselected teams of athletes
• A winning outcome is determined by the accumulated statistical results of fully completed contests or events and not merely a portion of a contest or event, except that a paid fantasy sports game participant may be credited for statistical results accumulated in a suspended or shortened contest or event that has been suspended or shortened due to weather or other natural or unforeseen event

Applicable statutes: AR Code Ann. §23-116-101 et seq.