Illinois’ new per‑bet tax structure is reshaping the state’s online sports wagering market, producing fewer individual bets but generating more revenue for the state. According to new analysis from Eilers & Krejcik Gaming (EKG), the tax—implemented in July—has reduced betting activity while simultaneously lifting adjusted gaming revenue (AGR).
The research firm cautions that the data is still early and should be interpreted carefully, but the trend is clear: bet volume is down, revenue is up.
Since the tax increase took effect on July 1, major operators DraftKings and FanDuel added their own per‑wager transaction fees, passing much of the cost directly to customers. As a result, the total number of wagers placed in Illinois has declined, yet state revenue has not suffered.
The Sports Betting Alliance (SBA) recently reported that Illinois bettors placed five million fewer wagers in September compared to the same month last year, reflecting consumer frustration with the new tax and operator fees. However, Illinois Gaming Board (IGB) data shows that tier‑one and tier‑two handle actually increased year over year, indicating that bettors are wagering more money per bet even as they place fewer bets overall.
Fewer Bets, Bigger Stakes
EKG’s analysis highlights two key developments:
- Wager volume has dropped, a predictable outcome when a per‑bet tax is largely passed on to consumers.
- AGR still climbed roughly 8%, in line with national gross gaming revenue trends, suggesting bettors are compensating for added fees by increasing the size of each wager rather than reducing overall spend.
Illinois’ tax structure applies a 25‑cent levy on the first 20 million online wagers, doubling to 50 cents per bet beyond that threshold. This hits high‑volume operators hardest—particularly DraftKings and FanDuel, which responded with their own 50‑cent per‑bet fees. Fanatics opted for a 25‑cent fee, while smaller operators raised minimum bet amounts instead of adding explicit surcharges.
Unlikely to Become a National Model
While Illinois is currently benefiting from higher revenue despite lower wager counts, EKG notes that the model is unlikely to be replicated elsewhere in the near term. The structure effectively encourages higher‑stake betting, which could raise responsible‑gaming concerns.
Even so, the broader trend is unmistakable: sports betting taxes across the U.S. are rising. In 2025, Louisiana, Maryland, New Jersey, and Washington, D.C. all increased their sports wagering tax rates, and several other states have proposed similar hikes.
For now, Illinois stands alone with its per‑bet tax experiment—one that is reshaping bettor behavior, challenging operators, and delivering a short‑term revenue boost that policymakers will be watching closely.
