Illinois Governor Shakes the Ground with Proposed 35% Tax on Sports Betting


In the bustling state of Illinois, a game of caustic comments and power plays is afoot as Governor J.B. Pritzker (D) weaves an intricate strategy to elevate the tax levy on sports betting from 15% to an imposing 35%. Possibly seeing the gaming industry as a promising cash cow for the state’s depleted treasury, the governor’s plan has ignited a fiery debate with several industry stakeholders who have, in turn, decried these moves as detrimental to the sector.

The Campaign for Fairer Gambling (CFG), an outspoken, solitary warrior for wagering reform, has cast a cold, skeptical eye toward the narrative the Sports Betting Alliance (SBA) is spinning. With a twirl of well-crafted words, CFG founder and financial patron Derek Webb smartly dismissed the SBA’s maneuvers. “It’s no Herculean task to spin a deceptive tale, gather signatures in support, and then crow about the assumed mandate,” he quipped.

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Webb went further to warn about the global gambling conglomerates and their knack for positioning sports betting as the opening act before their revenue-generating sideshow of slots and table games takes center stage, invariably causing more harm than good. The CFG imagines the possibility that the signatures the SBA has gathered through a petition to thwart Pritzker’s proposition might not be entirely legit.

The Sports Betting Alliance, backed by industry heavyweights such as BetMGM, DraftKings, FanDuel, and Penn Entertainment, among others, might be caught in the spotlight if these suspicions are confirmed.

However, should Illinois decide to implement this proposed 35% tax on sports wagering, it would trail only Pennsylvania (36%) and New York (51%) as the third-most severe tax regulation among the larger states in the country. During last year alone, hopeful bettors in Illinois placed wagers totaling an astounding $11.6 billion through various online and retail sportsbooks to the state, boosting state coffers by $150 million.

Interestingly, these claims by CFG directly contradict the SBA’s suggestion about the adverse effect of the tax increase on betting odds and the consequential revenue hold in Illinois. Using New York’s case as a benchmark, CFG noted that the state’s higher tax rate has not influenced bettor behavior or shifted the odds, discrediting the SBA’s deductive reasoning concerning high-tax-induced worse odds for players.

As if adding another chip to its bargaining force, some members of the SBA have put forth online gaming as a negotiation tool in light of Pritzker’s impending tax rise. These gaming pioneers believe that online casinos would act as a wellspring of income for the state.

A recent examination sponsored by the SBA pointed out that revenue from traditional, land-based casinos would slightly increase should online gaming be legalized in states such as Illinois, Louisiana, Maryland, New York, and Virginia. This argument appears to be a thinly veiled attempt to assuage fears that brick-and-mortar casinos might become financial roadkill in the rush for online gaming.

Despite the SBA’s assertive claims that online gaming could fetch an incredible $750 million in new revenue for Illinois, state authorities are not eager to approve online casino legislation.

The need for funds is palpable in the state of Illinois. The upcoming fiscal year, which will kick off on July 1, forecasts a budget deficit of $891 million. Even after accounting for a $170 million contribution to the state’s “rainy day” fund, Illinois will be left with a $721 million hole. Pritzker’s latest budget proposal swells to a spending aim of $52.7 billion, a significant leap from the $40 billion allocated in 2019. This narrative underscores the gripping saga the battle for sports betting tax in Illinois has become.