Illinois sports betting continues to climb at a double-digit clip in the face of new taxes and policy proposals targeting the country’s largest legal operators.
Sportsbooks in the state handled $1.60 billion in wagers in October, up 11% from last year to a new local record. Almost 98% of betting was conducted online.
Statewide hold of 8.7% was slightly below market for the month but still equated to $139 million of revenue and $42.9 million in taxes. Those payments to state and local government included almost $15 million from a new per-ticket tax that came into effect in July.
With Illinois sports betting numbers arriving last week, Arizona is the only state that has not yet published its October contribution toward what will be another all-time record month for nationwide volume north of $17 billion.
Winds shift for Illinois sports betting
Four months into the fiscal year, the new tax structure is having a noticeable impact on the behavior of Illinois’ bettors.
The total ticket count this October tumbled 16% to 34.3 million, following a similar drop in September despite the continued increase in handle and revenue. The average bet size for the month swelled to $46.82 from $35.53 last October.
Operators have maneuvered around the ticket tax by either passing along a per-bet fee to customers or implementing a minimum bet size, both of which are driving that increase in the average wager amount.
A taxing situation for Illinois operators
The ticket tax is not the only financial adversity operators have faced in Illinois.
The governor’s 2024 budget first imposed a tiered structure that targeted the market leaders with tax rates of up to 40%, sharply higher than the flat 15% originally passed by the legislature. The newer per-wager tax again hits the leaders the hardest, expected to push their annual rates above 50% by the end of the fiscal year.
Further frustrating the situation is a new budget for Chicago that would add a 10.25% city tax while also effectively banning online sports betting within city limits by requiring a city-level license for which no application or approval process currently exits. The updated policy could go into effect on Jan. 1 if it is not vetoed by the mayor due to issues not including the betting tax.
Illinois, meanwhile, remains the second-largest legal sports betting market in the country behind New York – also a high-tax market at 51%.
DraftKings continues to lead in Illinois
For all the extra headwinds they face in Illinois, it would be tough for FanDuel and DraftKings to scale back their presence. The two leaders together wring more than $1 billion of gross revenue out of the market annually.
DraftKings has a nice little lead in monthly volume, making Illinois one of the strongest markets in its portfolio. The handle gap was more than four points in October, with DraftKings outhandling FanDuel 36% to 32%.
Revenue is more fluid from month to month, the lead changing hands several times over the course of the past few years. DraftKings was back on top in October with a win of $52.5 million (39% share) to FanDuel’s $42.5 million (31%).
Fanatics has comfortably settled into third place behind the leaders, holding about a 7.5% share of both handle and revenue in any given month.
