As Circa Sports begins planning in earnest for life in Missouri this winter, it has become the latest sportsbook to alter its policies in Illinois after recent major tax changes.
Hours after the operator was announced as one of the two recipients of an untethered online sports betting in Missouri’s upcoming market, Circa CEO Derek Stevens confirmed his company will no longer be accepting bets worth less than $10 in Illinois starting Sept. 1.
The measure is in response to the state’s implementation of a $0.25 fee per wager for all licensed sportsbooks in the state. Circa has been live with mobile sports betting in Illinois for nearly two years.
Announcing the shift on social media, Stevens pointed to the sportsbook’s low-hold model as a reason for the change.
“After thoughtful consideration, we believe the best course of action for a low-hold, high-volume sportsbook such as Circa Sports is to raise the minimum wager in Illinois,” Stevens posted on X, formerly Twitter. “We are reluctant to compromise our best-in-class betting splits or charge our customers a per-bet fee.
“Beginning Monday, September 1, a $10 minimum wager will take effect, protecting the vast majority of bettors in Illinois. No one should have to pay a fee to make a wager.
Stevens noted a couple of days earlier to the Missouri Gaming Commission that Circa’s sports betting hold is around 3.5% compared to rates of typically more than 10% at bigger sportsbooks. Some 95% of its handle comes from bets worth more than $50. “We take larger bets, we do not limit professional players,” he said. “We focus on bigger bets, bigger volume, bigger handle.”
As such, Circa likely does not see the $10 minimum as something that changes the nature of its game too much in Illinois.
‘No reason to take bet less than $10’
The $10 million measure also aligns with comments Stevens made back in early June, not long after news broke about Illinois’ 25-cent per-wager tax.
“You can kiss those $1, $2, $5, $10 bets [goodbye]. That’s going to be the good old days,” Stevens told Vegas Stats & Information Network’s (VSiN) ‘Follow the Money’ show.
“Effectively, what it means is you’re gonna have to raise minimums, particularly for low-hold operators. If we try to hold 3%, by the time we’ve got to pay the federal excise tax, and then we have to pay a fee to be an authorized gaming operator with MLB and others, and then you throw this tax on, there’s nothing there. There’s no reason to take a bet less than 10 bucks.”
Stevens went as far as to admit that, were the tax situation in Illinois the same when Circa entered the state in late 2023 as it is today, he would likely alter Circa’s model. “I don’t think a low-hold model that Circa has would make sense under that environment.”
8 out of 10 cats
With Circa announcing its $10 minimum bet value, by far the largest implemented in Illinois thus far, eight of the state’s 10 licensed online sportsbooks have now announced some kind of mitigating measure in response to the per-wager tax. Only bet365 and Caesars have so far taken no action.
BetMGM, Hard Rock Bet, BetRivers and ESPN Bet have also all either introduced a new minimum stake amount or raised an existing one in the state. BetMGM now doesn’t allow bets under $2.50 in the state, Hard Rock Bet has raised its minimum to $2 and both Rush Street Interactive’s BetRivers and PENN Interactive’s ESPN Bet have raised their respective baselines from 10 cents to $1.
Meanwhile, DraftKings, FanDuel and Fanatics are passing on the per-wager tax to customers via fees. FanDuel and DraftKings, which pay the highest gross gaming revenue tax cut of 40% in Illinois and are on the hook to pay 50 cents per bet rather than 25, will implement 50-cent transaction fees on every wager placed in Illinois starting Sept. 1, while Fanatics will add a 25-cent transaction fee in the fall.
Neither the Illinois Gaming Board (IGB) nor any operator has explicitly confirmed whether those transaction fees themselves will also be taxable, but instructions sent to operators by the IGB last month suggest they could well be.
