Illinois Lawmakers OK Sports Betting Tax Hike

The Illinois House of Representatives early Wednesday approved a record $53.1 billion state budget, including a “huge” tax increase on legal sports betting operators.

With the House signing off on the budget just before 2:30 a.m., the spending plan, already approved by the Senate, heads to Democratic Gov. J.B. Pritzker, pictured, at the Capitol in Springfield for his consideration. The governor has indicated he will sign the budget, which would kick in July 1 for the new fiscal year.

The tax hike on sports betting operators brings the current tax rate of 15% to 20%-40%, depending on the operator’s annual revenues. That rate would give Illinois some of the highest sports betting tax rates in the country. Currently, sports betting tax rates nationwide range from 6.75% in Iowa to 51% in New York and New Hampshire.

Sports betting is legal in 38 states and Washington, D.C., including every state bordering Illinois, except Missouri.

Sportsbooks Warn Of Worse Odds For Illinois Bettors

According to ABC7 Chicago, this “huge tax on sports betting operators” is expected to bring Illinois $200 million in tax revenue. The tax hike has the sports betting industry "up in arms,” the television station reported.

Earlier this week, the Sports Betting Alliance issued a statement on X (Twitter), warning that the tax increase in Illinois could drive bettors to unregulated offshore sites that don’t pay taxes in Illinois. Members of the alliance include BetMGM, Fanatics, FanDuel and DraftKings.

Alliance President Jeremy Kudon said the increase will have a “devastating” impact, leading to “worse promotions, and inevitably, worse odds for Illinois customers.”

Governor Touts Budget, GOP Lawmakers Criticize Taxes

The governor praised the budget, saying it helps many people in the state.

”From expectant mothers and their newborn babies to people with disabilities to veterans to seniors who need our care, we're keeping our promises to all Illinoisans and the most vulnerable among us,” he said in a statement.

According to ABC7 Chicago, Republicans, including Rep. Dan Ugaste, R-Geneva, expressed concern over several portions of the budget, including tax increases.

"One of the biggest problems we have in Illinois is over-taxation of businesses and residents and this budget once again calls for huge tax increases,” Ugaste said in a statement.