Illinois online sportsbooks paid $5.2 million in per-wager taxes in July, with DraftKings and FanDuel alone contributing nearly $4 million. The data, released by the Illinois Gaming Board (IGB), comes as the state’s newly implemented per-wager tax has delivered its first returns.
The law, effective 1 July, requires licensed sportsbooks to pay 25 cents on every bet placed. If an operator surpasses 20 million wagers in a fiscal year, the tax doubles to 50 cents per bet.
A total of 20.7 million digital wagers were placed across Illinois’ 10 licensed sportsbooks in July. DraftKings and FanDuel accounted for 15.8 million bets combined, paying nearly $4 million in taxes. With football season approaching, both operators are on pace to quickly surpass the 20 million-bet threshold, which will subject them to the higher 50-cent per-wager fee.
Sportsbooks shift costs to bettors
Half of Illinois’ sportsbooks have begun charging customers a per-bet fee, while the rest raised minimum stake requirements. DraftKings and FanDuel started applying surcharges on 1 September. Analysts at Citizens JMP said DraftKings’ fee is already showing the “desired outcome” for the operator.
Operators like BetMGM and Circa have instead introduced higher minimum wagers, some as steep as $10 per bet. Mid-July, BetMGM confirmed to SiGMA News that it will introduce a minimum wager limit of $2.50 in Illinois, effective 16 July. The new minimum applies to all bet types, including parlays, same-game parlays, straight bets, round robins, and live in-play wagers.
Even when sportsbooks pass fees onto bettors, the IGB clarified that they must still pay taxes on these surcharges. “The Sports Wagering Act puts responsibility for the per-wager tax on the licensee,” an IGB spokesperson was quoted by SBC Americas. “Sportsbooks are permitted to charge patrons whatever fees they wish, but all such fees are taxed as sports wagering receipts.”
Expert commentary: What it means for bettors
Experts warn the policy could set a troubling precedent for US sports betting. Until now, major operators had largely absorbed rising tax rates without directly penalising bettors. But that trend has snapped.
“This is a distressingly simple model to copy,” longtime Nevada sportsbook director Robert Walker previously told SiGMA News. “And because of that, other states will almost certainly view it as a viable, if deeply flawed, template.” Illinois has already hiked its top tax tier from 15 percent to 40 percent, and the per-bet levy now piles additional pressure on operator margins.
The true impact is most pronounced for casual players. “For a $5 casual wager, that’s a 10 percent fee,” Walker said. “It punishes the smallest players—ironically, the exact demographic every operator covets for their high-margin potential.” He warned that by normalising surcharges, operators have effectively made it easier for lawmakers in other states to replicate the model.
Gaming attorney Jeff Ifrah had echoed those concerns, noting sportsbooks operate on razor-thin margins. “The per-bet fee is a response to increased burdens,” he said. “But it’s not ideal. Operators want to offer promotions and competitive odds to draw bettors into the legal market—not drive them out.”
The risk, experts say, is that bettors migrate to unregulated or offshore markets, which pay no taxes and provide no safeguards. “These platforms don’t contribute to public health funding,” Keith Scott Whyte, founder of Safer Gambling Strategies LLC told SiGMA News. “If someone develops a gambling problem there, the cost falls entirely on the public health system.”
Walker concluded: “Exorbitant tax rates hurt the entire ecosystem. And if we keep escalating costs for the smallest, most vulnerable bettors, we’re accelerating the decline of the legal, regulated market.”
Industry outlook
Illinois already levies one of the country’s highest tax rates on sports betting, charging between 20 percent and 40 percent of adjusted gross gaming revenue (AGR). With both DraftKings and FanDuel reporting AGR above $30 million in July, the new per-wager levy piles onto an already heavy burden.
The policy shift highlights the growing tension between state tax strategies and operator profitability—and the likelihood that consumers will continue shouldering higher betting costs, as warned by experts.
