DraftKings says it will add a 50-cent charge to every online and mobile sports bet in Illinois starting September 1, 2025. This decision mirrors FanDuel‘s recent action and serves as a direct reaction to new tax laws passed by Illinois lawmakers.
Rising Illinois Sports Betting Taxes Threaten Legal Market, Warns DraftKings CEO
The new state policy puts a tax on each bet for licensed sportsbook operators. The rule says the first 20 million bets each year cost $0.25 each. After that, the price goes up to $0.50 per bet. People who study the industry think big companies like DraftKings and FanDuel, who handle more than 20 million bets, might have to pay tens of millions more in taxes every year.
In a statement, DraftKings CEO Jason Robins voiced his annoyance with Illinois’ tax approach. He said the state has increased the tax load on big operators in the last two years. Robins also cautioned that the rising costs could weaken the legal sports betting market. This might make unregulated platforms more appealing to consumers because they lack oversight and do not have to pay taxes.
Illinois has become a key market for online sportsbooks. Big states like California and Texas do not offer competitive digital sports betting right now. This puts Illinois among the top three markets in the country. As a result, leading platforms like DraftKings and FanDuel need to stay in Illinois even though it costs more to operate there.
DraftKings Faces Backlash Over Illinois Bet Fee but Stands Ready to Work with Regulators
DraftKings stated that the new customer fee aims to counter the growing tax pressures that have pushed operator tax rates to almost 60%, the highest in the US. While DraftKings suggested similar fees last year in several states, they abandoned those plans after customers pushed back and other industry players did not get on board.
The company stressed that it is ready to work with state officials to find long-lasting solutions that work for everyone. If Illinois scraps the new per-wager tax, DraftKings promised it would remove the extra charge from bets.
The decision has already sparked varied responses. Some view this change as an essential step to address regulatory demands, while others claim it shifts the expense straight to users and might result in less participation or a move towards uncontrolled options. Governor J.B. Pritzker will approve the state’s budget soon, setting the stage for the new financial framework around sports betting in Illinois to transform how big platforms work, and how much gamblers shell out.