The chair of Illinois’ House Gaming Committee wants the state to abandon its controversial per-wager tax on online sportsbooks.
Rep. Daniel Didech’s HB 5143 proposes to end the practice of charging sportsbooks up to 50 cents for every wager they take on sports in the state. The bill’s change would be effective July 1, 2026, ending the unique tax charge after one fiscal year in place.
Per-bet charge yields tens of millions for Illinois
Illinois implemented its per-wager tax beginning July 1, 2025, as part of the fiscal budget signed into law by Gov. J.B. Pritzker aimed at generating more tax dollars for the state. It charges licensed online sportsbooks 25 cents on each of the first 20 million online sports bets placed on the operator’s platform the state every fiscal year, and hikes that fee to 50 cents for every bet beyond that threshold.
Lawmakers estimated that the tax could bring in around $36 million extra for the state per year starting in FY 2025-26. Per Illinois Gaming Board (IGB) revenue data, the per-wager charge actually took only four months to generate roughly that windfall and raised more than $60 million in the first half-year of its existence.
Citizens JMP analysts estimated at the time that FanDuel and DraftKings, who take by far the most wagers in Illinois on a monthly basis, stood to take hits of around $80 million to their adjusted EBITDA in 2026 as a result of the new tax fee. That pair has already paid more than $50 million in per-wager taxes between them.
All 10 sportsbooks changed their Illinois approach
Those two sportsbooks and other major operators voiced vociferous opposition to the change. The Sports Betting Alliance (SBA), made up of FanDuel, DraftKings, Fanatics, BetMGM and bet365, launched a campaign urging Illinois residents to oppose the alteration. The Responsible Online Gambling Association (ROGA), which comprises the five SBA members plus PENN Entertainment, Hard Rock Digital and Bally’s, also publicly opposed the plan, warning it would send bettors to the black market.
The SBA has pointed out that the number of wagers placed on licensed sportsbooks in Illinois dropped by around 15% year over year this fall after the implementation, although Illinois’ betting handle continues to climb. That latter fact may have something to do with the fact that all 10 licensed sportbooks either installed customer surcharges or imposed or raised minimum bet stakes in Illinois to offset the cost of the fee.
If the effort to repeal the per-wager tax succeeded and made it into state law, sportsbooks would be faced with a choice over whether to return to their operational status quo before the charge came into effect.
Illinois’ heavy tax burden
The per-wager fee was the second major statewide sports betting tax change made by Illinois in the space of 12 months.
As of July 1, 2024, sportsbooks pay a sliding scale of tax, starting at 20% on their annual adjusted gross sports betting revenue up to and including $30 million and topping out at 40% on annual AGR above $200 million. The state’s previous flat rate was 15%.
Meanwhile, as of the start of 2026, the city of Chicago is charging online operators a 10.25% tax on online sports bets they take within the city limits. Cook County, which contains Chicago, also charges a 2% sports betting tax.
It all adds up to make Illinois one of the most expensive states for licensed sportsbooks to do business.
Legislation is already on the table to prevent Chicago from taxing online sports bets, arguing that it should be a state-level prerogative. Didech authored a bill to stop the Chicago tax last year, before it came into effect. His bill, and two separate pieces of legislation addressing the Chicago tax in the Senate, are awaiting committee discussion.
In the meantime, Didech thinks it’s time to call off the per-wager charge, too.
