To compensate for the per-wager tax that the state of Illinois levies, which can reach up to fifty cents per wager, the sports betting provider FanDuel has imposed a fifty-cent premium to all wagers placed in the state.
The tax is passed on to FanDuel’s consumers through the surcharge, and it will continue to be in force for as long as the state of Illinois continues to operate under the per-wager tax.
“FanDuel will immediately remove the $0.50 transaction fee,” officials from Flutter Entertainment, the company that owns FanDuel, stated in a press release. “Should the state reverse its decision at any point in the future,” the statement read.
Peter Jackson, Chief Executive Officer of Flutter, stated in a prepared statement that the Illinois tax will have a disproportionate impact on bettors who place small wagers.
“There is an optimal level for gaming tax rates that enables operators to provide the best experience for customers, maximize market growth and maximize revenue for states over time,” Jackson stated.
“We are disappointed that the Illinois Transaction Fee will disproportionately impact lower wagering recreational customers while also punishing those operators who have invested the most to grow the online regulated market in the state,” he continued.
According to Flutter, many users will move to offshore betting sites that are exempt from the Illinois tax rather than paying a 50-cent fee on a $5 wager.
Another well-known sportsbook that is thinking about charging Illinois residents to defray the state fee is DraftKings.
A representative for DraftKings stated, “DraftKings expects to share more information soon and anticipates taking action.”
Between FanDuel and DraftKings, approximately three-fourths of Illinois sports betting bets are placed.
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According to an LSR estimate, Illinois sports books paid almost $276 million in state taxes in 2024.
Together, FanDuel and DraftKings paid $74 million and $67.9 million in state taxes on over 150 million wagers.
Under Illinois’ new per-wager tax, internet sports books must pay 25 cents per wager on the first 20 million wagers they accept, and then 50 cents per wager on any other bets.
Jordan Bender, a Citizens gaming analyst, told that FanDuel and DraftKings may lose $86 million and $79 million, respectively, in 2026 as a result of the transactions tax.
In addition to the per-bet tax, Illinois increased its sports book earnings tax from 15% to 20% to 40% last year.
