FanDuel Sportsbook is urging customers to reach out to state lawmakers in an effort to stop the proposed tax hike on Illinois sports betting.
As part of his recent budget proposal, Gov. JB Pritzker suggested increasing the tax rate on Illinois sports betting to 35% from 15%.
The FanDuel app alert went out to Illinois customers over the weekend.
FanDuel’s Illinois sports betting alert
The message reads, as obtained via screenshot from PlayIllinois:
“STOP THE SPORTS BETTING TAX HIKE!
“We NEED your HELP! The Illinois legislature wants to MASSIVELY increase the tax rate on your favorite form of entertainment—placing bets on the teams, players, and games that you love!
“Use the link below to tell Governor Pritzker and your state representatives to say NO to a sports betting tax hike.”
Sports betting tax increases elsewhere
Illinois is not the only state that wants to raise the tax rate on sports betting.
A New Jersey lawmaker recently introduced a bill that would increase the online sports betting tax rate to 30% from 14.25%.
Ohio signed into law a sports betting tax rate increase that doubled the rate to 20% from 10% for the 2024-25 fiscal year.
FanDuel CEO on tax rates
FanDuel CEO Amy Howe explained to LSR the operator’s general stance on sports betting tax rate increases.
“Our government affairs teams do a really good job of trying to educate the regulators on how to get that balance right, because at the end of the day, the revenue to the state is really important,” Howe told LSR.
“But also, if that tax rate becomes too high, then it shuts down competition. And has some unintended consequences of pushing consumers back to the black market. Which, ultimately, is not in the best interest of the state or consumers.
“So it’s about threading that needle. And it’s partly on us to make sure that we can work with state regulators to educate them on how to get that balance right.”
Illinois sports betting vs. New York
The biggest legal sports betting market at the moment, New York, has the biggest online sports betting tax rate at 51%.
The sports betting operators in the Empire State negotiated and agreed to the 51% tax rate.
It has led to a tax revenue windfall for New York. In the 2023-24 fiscal year, the Empire State gained $898.5 million in tax revenue from online sports betting.
Operators tried for NY tax decrease
Previous attempts to decrease the tax rate in New York by increasing the number of operators have been unsuccessful.
Last year, DraftKings CEO Jason Robins suggested to Empire State regulators that without a reduction in tax rate, the operator might be “forced” to offer worse odds in New York sports betting.
