Illinois‘ online sportsbooks paid the state more than $5.2 million via the new per-wager tax charge in July, the first month it was in effect, according to the latest revenue report from the Illinois Gaming Board (IGB).
Beginning July 1, all licensed sports betting operators in the state fork out 25 cents for every sports wager they take on their respective platforms. If a sportsbook eclipses 20 million bets in a fiscal year, the tax will double to 50 cents per bet.
Over 20 million wagers placed in July
From July 1-31, around 20.7 million digital bets were placed across the 10 licensed sportsbooks. DraftKings and FanDuel, the two biggest sportsbooks by a large distance, accounted for around 15.8 million of those and almost $4 million of the tax revenue.
Those two sportsbooks are also the ones certain to exceed 20 million wagers. Given July’s numbers, both look likely to do it very quickly. July is a notoriously slow month for sports betting, so the start of football season will certainly push them past that threshold in short order.
Here’s a breakdown by operator of the first month of the per-bet tax:
| Number of wagers | Per-bet tax paid | Response to tax | |
| DraftKings | 8,312,137 | $2.08 million | 50¢ charge per bet* |
| FanDuel | 7,518,289 | $1.88 million | 50¢ charge per bet |
| Fanatics | 1,229,106 | $307,276 | 25¢ charge per bet |
| bet365 | 995,989 | $248,997 | 25¢ charge per bet* |
| BetMGM | 817,418 | $204,354 | $2.50 min. bet |
| BetRivers | 556,535 | $139,134 | $1 min. bet |
| Caesars | 483,965 | $120,991 | 25¢ charge per bet |
| ESPN Bet | 466,588 | $116,647 | $1 min. bet |
| Hard Rock | 398,267 | $99,567 | $2 min. bet |
| Circa | 26,953 | $6,738 | $10 min. bet |
| Totals | ~20.8 million | ~$5.2 million |
As noted above, Illinois’ 10 online sportsbooks all responded to the per-wager tax charge in their own way. Half of them announced plans to charge customers for each bet they place. The asterisk next to DraftKings reflects that the operator has detailed an array of conditions and parameters for its charges, including that the cost of the fee will vary by user, while Bet365 is only charging its fee on bets under $10.
The other five sportsbooks instead opted for minimum bet stakes, ranging from $1 to $10.
DraftKings and FanDuel both began charging customers on Sept. 1. It will be some time before IGB releases September numbers, but a note from Citizens JMP issued on Sept. 17 deemed that DraftKings’ surcharge has so far produced the “desired outcome” for the company.
Operators will pay taxes on customer surcharges
Sportsbooks that opted to charge customers are still having to pay out of pocket to cover the cost of these state fees.
As of July 2024, Illinois sportsbooks already pay anywhere from 20% to 40% of their adjusted gross gaming revenue as tax. DraftKings and FanDuel are on the hook for the highest amount, which is charged on FY AGR above $200 million. Both of those operators posted AGR of more than $30 million in July alone.
The IGB sent operators a letter on July 10 in which it explained that when reporting their AGR each month, sportsbooks must include the money they make from these customer fees under “Other Gross Sports Wagering Receipts.”
“The Sports Wagering Act puts responsibility for the per-wager tax on the licensee,” an IGB spokesperson told SBC Americas. “Sportsbooks are permitted to charge patrons whatever fees they wish to place wagers, but all such fees are taxed as sports wagering receipts.”
What might this extra tax burden look like for pass-through fees?
As an example, were Fanatics to have charged users a 25-cent fee this month to cover its $307,000 in wager taxes, it would have paid around $61,000 in taxes on those surcharges.
Meanwhile, the sportsbooks that instead opted for a bet minimum will avoid owing any compound tax on a customer surcharge, but will have to hope their increased minimum stake offsets the economic impact of the state’s per-tax fee.
