Sports Betting Alliance Blasts Illinois’ Dysfunctional Tax

Now, the Sports Betting Alliance (SBA), a trade group, has openly and severely criticized the measure of imposing a mandatory $0.25 per bet on the first 20 million bets, and $0.50 on anything after that.

This measure is set to prove not only highly unpopular, but also undermine the market’s competitiveness, the SBA has said in a statement blasting the short-sightedness of the decision.

Gambling Tax in Illinois Will Diminish the Legal Market, Reduce Tax Payments

“Data shows the state’s new per-wager tax will have the most impact on recreational bettors in Illinois who place small-dollar wagers, with more than half of bets placed in Illinois at $5 or less,” the alliance said, arguing that Illinois residents would now be forced to turn to more favorable betting options which are provided by illegal and predatory sportsbooks that do not hod a legitimate license.

What this means is that rather than boosting tax for the state’s coffers, the measure will only undermine the market’s competitiveness to the point that the regulated market will not only drive away customers but also pay less into the budget.

The SBA explained that moving forward, companies will oblige customers to place a minimum bet to make their offers viable, offer less favorable odds, or introduce a surcharge on every customer bet. Often, it can be a combination of all, which will significantly suppress the total betting handle.

DraftKings, Fanatics, FanDuel, Circa Sports, ESPN Bet, BetMGM, and others have all been rolling out initiatives, trying to outwit each other in the way they approach the market, but ultimately, these measures will backfire because of the reduced overall handle, which the SBA predicts as a result of the tax’s implementation.

“Unregulated, offshore operators offer cheaper sports betting alternatives for consumers, without any consumer protections — including age verification — and without any oversight,” the statement wrapped up.