Illinois has approved a major tax hike for sports betting operators as the state seeks to increase tax revenues for public spending which is expected to exceed $53.1 billion in the next fiscal year.
Illinois Sport Betting Tax Rate Increase on the WayAs a result, the state needs to generate additional revenues from a variety of sources with sports betting being one of the biggest contributors.
Sports Betting Tax Increase
Gov. J.B. Pritzker had originally sought to increase the sports wagering tax rate from 15% of gross revenues to a flat rate of 35%. However, lawmakers have set out a new progressive tax structure that will see rates ranging from 20% to 40%. The rate charged depends on the sportsbook’s gross revenues.
Illinois Sport Betting Tax Rate Increase on the Way, an unrelated bill.The rates are as follows:
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Illinois Sport Betting Tax Rate Increase on the Way
- 25% – Annual AGR $30 million to $50 million
- 30% – Annual AGR $50 million to $100 million
- 35% – Annual AGR $100 million to $200 million
- 40% – Annual AGR over $200 million
When the tax rate increase was originally proposed, Illinois sports betting operators suggested that the increase would result in poorer odds for sports bettors. However, this has not been the case in states with higher rates such as New York, New Hampshire, and Rhode Island.
Stocks in sports-betting companies like DraftKings (DKNG) and FanDuel’s parent Flutter Entertainment (FLUT) slid on Tuesday following passage of the new state budget.
An experienced iGaming commentator and analyst based in New York City - Jenny reports on regulation and gambling industry news and events.