The two largest sportsbooks in the US will soon charge Illinois customers for each bet to offset the state’s latest sports betting tax, according to Thursday‘s announcement from DraftKings.
DraftKings will charge customers 50 cents per bet, which is identical to FanDuel‘s fee announced Tuesday. After the FanDuel announcement, DraftKings told LSR that the company anticipated taking action.
Just like FanDuel, DraftKings will drop the per-bet fee if Illinois eliminates the fee against operators. Both operators will begin the fee Sept. 1, three days before the NFL season kicks off.
The new fee charges sportsbooks 25 cents for the first 20 million bets annually, charging 50 cents per bet after that milestone. Only DraftKings and FanDuel accepted more than 20 million bets in Illinois last year.
DraftKings ‘disappointed’ in latest tax
The per-bet fee comes a year after Illinois legislators significantly raised its sports betting tax rate from a flat 15% to a tiered system up to 40%.
“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,” DraftKings CEO Jason Robins said.
“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. Meanwhile, Illinois continues to fuel the rapidly growing illegal industry, which pays no taxes or fees and provides none of the consumer protections that regulated operators offer.”
DK considered fees last year
DraftKings’ decision to charge a per-bet fee is not a surprise, considering the company pitched something similar last summer.
The sportsbook was prepared to implement a “gaming tax surcharge” in four states with sports betting tax rates higher than 20%, including Illinois.
That was short-lived, though, as the idea did not get a great reception. BetRivers announced days later that it would not add a similar fee because “we put our customers first.”
FanDuel decided against a fee as well, which led DraftKings to scrap its plans about two weeks after they were announced.
