Illinois’ New Betting Tax Leads to a Decrease in Bets

Illinois’ new tax regime seems to be having an adverse effect on the sports betting industry, in line with some analysts’ predictions. Recent figures suggest that the sports betting activity has been steadily declining due to the tax changes and the measures operators implemented to break even.

Illinois Introduced a New Betting Tax

A report by 25 News Now took a look at recent data from the Illinois Gaming Board, revealing a significant decline in sports betting participation. The trend coincides with the introduction of the state’s new gaming tax rules, which forced some operators to implement additional fees.

For context, Illinois’ new regime introduced a $0.25 tax on the first 20 million wagers sportsbooks process, as well as a $0.50 tax on every wager after that. This controversial decision was thoroughly scrutinized by industry stakeholders but ended up getting signed into law anyways.

Critics said that the changes will disproportionately affect bigger companies that process a larger volume of wagers. They also said that the new rules will make business harder, forcing many operators to implement extra customer fees. Experts predicted that these changes could alienate customers, potentially forcing them to play with offshore brands.

In any case, operators did end up implementing new fees to break even. Major betting firms, such as FanDuel and DraftKings ended up introducing a flat $0.50 fee per wager in order to maintain their profitability.

However, it seems that this has indeed ended up pushing customers away.

Sophisticated Bettors Always Seek to Cut Costs

The data cited by 25 News Now suggested that customers in Illinois have placed 5 million fewer wagers in September 2025 than they did in September 2024. These figures correspond to a 15% decline in the total number of wagers.

While these figures could have been partially affected by seasonal fluctuations, the Sports Betting Alliance was convinced that the new tax was to blame.

Joe Maloney, the alliance’s president, spoke with 25 News Now, emphasizing that Illinois is the only state out of all states with legal betting where this is happening. While fewer bets might seem like a good thing on the surface, the organization postulated that the bets are still taking place, albeit with illegal operators.

Any bettor with any level of sophistication is really paying attention to their costs, right? And so, when you have the ability to have multiple competitive entrants across the state of Illinois in the legal regulated marketplace and then a myriad number of options in illegal or unregulated sites, you’re going to go for that best price.

Joe Maloney, president, Sports Betting Alliance

Maloney emphasized that the original idea behind legalizing sports betting in Illinois was to encourage existing gamblers to bet legally, preventing both player harm and a drain of tax funds to the black market.

However, the recent tax changes might be interfering with these goals, according to many industry stakeholders.