Illinois will soon increase taxes on sports betting, but not everyone is celebrating the incoming changes.
Political rivals in the Prairie State have scrutinized the 2025 fiscal budget signed by Governor J.B. Pritzker earlier this month, which includes increased taxes on sports betting operations. However, Senator Elgie Sims, who helped negotiate the budget, argues that it won’t impact the general population.
According to Sims, the changes to taxes on sportsbook operations were needed following the “explosion of the industry” to restore “some parity.”
“There weren’t tax increases or revenue enhancements against everyday ordinary taxpayers," Sims commented.
Previously, Illinois taxed sportsbook revenues at a flat rate of 15%, but this will change to a progressive rate when the new rates come into effect on July 1. To reflect the revenue operators collect, there are now five different tax brackets, the lowest being 20% on gross revenue of less than $30 million, with brackets up to 40% on gross revenue over $200 million.
Upon signing the bill, Governor Pritzker dismissed the idea of sportsbooks leaving the state due to
increased taxes.
“They’re not leaving New York, and they’re not leaving the other states,” said Pritzker. “We had a much lower tax rate than many of the largest of those markets. And we’re just kind of bringing ourselves more in line but at a lower rate.”
The 2025 budget also includes a slight increase in the tax on video gambling terminals, which was previously 34% and has now been raised to 35%. Of this, 29% will be used on capital construction projects, 1% will boost state construction, and 5% will be given to local municipalities.
