Monday, June 24, 2024

Illinois Considering a New Progressive Tax Rate for Sports Betting

Illinois Senate Approves New Progressive Sports Betting Tax Rate for Operators

Illinois Senate Approves Progressive Sports Betting Tax Rate in State Budget

The Illinois Senate recently approved a new progressive sports betting tax rate for licensed operators as part of the state budget. This move has sparked controversy among operators who are unhappy with the proposed tax structure.

According to the approved budget, operators will now pay taxes based on their adjusted gross sports betting revenues. The tax rates will be as follows:

– $0 to $30 million: 20%
– $30 million to $50 million: 25%
– $50 million to $100 million: 30%
– $100 million to $200 million: 35%
– Over $200 million: 40%

This new tax structure would make Illinois the first state in the country to implement a progressive sports betting tax rate. If the budget is approved by the House and signed into law by Governor J.B. Pritzker, it will go into effect on July 1.

Operators such as FanDuel and DraftKings, with high adjusted gross revenue totals, would fall into the top tax tier and face a 40% tax rate. On the other hand, smaller operators like BetRivers and Fanatics Sportsbook would see their tax rates increase from 15% to 30%.

Industry sources have indicated that no operators in the state are pleased with the new tax plan. The Sports Betting Alliance President, Jeremy Kudon, expressed disappointment with the decision, citing that it could result in worse services for customers and push them towards unregulated markets.

Overall, the approved progressive sports betting tax rate in Illinois has caused a stir in the regulated sports betting industry. Operators are now waiting to see if the House will approve the budget and how this new tax structure will impact their operations moving forward.

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