Life for Illinois’ low-stakes sports bettors is getting more difficult by the day. Late last week DraftKings announced that is following its rival FanDuel’s lead by adding a $.50 transaction fee to all wagers placed through its online sportsbook in Illinois. The move is in response to an impending $.25 single bet tax being imposed by the State of Illinois on Illinois-facing operators.
The new tax, and the new transaction fee, both are set to go into effect on September 1. This coincides with the start of US football season which is, not coincidentally, the busiest betting season on the US calendar. Illinois’ new tax only applies to operators doing more than $200 million in business which, in Illinois, are FanDuel and DraftKings.
DraftKings CEO Jason Robins commented on the new tax in an online letter saying, “Illinois has been an important part of our growth, and we’re proud to have contributed meaningfully to the state through tax revenue, job creation and a sustained investment in responsible gaming tools and resources. We are disappointed that Illinois policymakers have chosen to more than triple our tax rate over the past two years, and we are very concerned about what this will do to the legal, regulated industry.”
Illinois is one of many states that are re-evaluating their tax deals with sports betting operators after seeing what kind of revenue these businesses really pull in. The Governor of the State of Colorado, for example, recently passed a bill closing the loophole that allowed operators to write off free and promotional bets as marketing costs.