Illinois Progressive Sports Betting Tax Rate Signed Into Law

Illinois Gov. JB Pritzker has signed HB 4951 into law, greenlighting the $53.1 billion budget initiative for FY 2025. The bill includes a new progressive sports betting tax rate for Illinois sportsbooks. Operators could now pay up to 40% of adjusted gross revenue (AGR).

Illinois New Sports Betting Tax Signed Into Law

The measure was amended in the Senate and passed to a vote of 37-22 last week. The House then voted in favor of concurrence of the amendments, and the bill advanced to Gov. Pritzker’s desk. Gov. Pritzker signed the measure into law on Wednesday.

“The FY25 budget is another demonstration of the fiscal responsibility that has guided me from Day 1 of my administration,” Pritzker said. “This budget is balanced, pro-family, cuts taxes on workers, and opens up doors of opportunity for employers and employees alike. I’m proud to sign it today and look forward to working together to bring these investments to life in a healthier, more prosperous Illinois.”

With the new rate, sports betting taxes see an overall increase for sportsbooks in Illinois. Operators were initially taxed 15% across the board. Now, operators will see a progressive increase in taxes based on how much they rake in on AGR monthly. Even the lowest possible rate has increased to 20% with the highest reaching 40% in taxes.

Illinois Progressive Tax Rate For Sports Betting

• AGR over $30 million, 25%
• AGR over $50 million, 30%
• AGR over $100 million, 35%
• AGR over $200 million, 40%

Measure Passes Despite Pushback

Members of the Sports Betting Alliance voiced their issue with the new tax rate throughout the legislative process. This did not seem to affect the decision of Illinois lawmakers to push the new budget. In a legal opinion, the Sports Betting Alliance cited that the tax rate could negatively effect local businesses and push bettors back to the illegal market.

Illinois now has the second largest sports betting tax rate in the US with the potential for up to 40%. Only New York, with a 51% tax rate is higher.