Illinois lawmakers want per-wager levy on bets overturned

• Illinois is planning to overturn the per-wager taxation it introduced last year, followed by a decline in sports betting activity
• House Bill 5143 does not directly cite data tied to the reduced sports betting activity in the state
• Michigan is in the meantime planning to explore a per-wager tax concept for its own sports gambling framework

Illinois lawmakers may have been hasty in introducing a change to the state’s gambling tax framework, charging $0.25 per sports bet wager on the first 20m bets and then $0.50 per wager from sportsbooks - a tax that was directly passed onto bettors by the bookies in the form of worse odds and promotions.

Possibly seeing the error of their ways, a new draft law has been filed that will overturn the tax. House Bill 5143 has been filed recently and seeks to end this taxation on July 1, 2026, allowing operators to only worry about the tiered taxation system, which collects anything between 20% and 40% on an operator’s revenue, depending on how much that is.

Illinois mulls overturning the per-wager tax it introduced for sports wagering

This legislation comes at the right time, as there has been a growing body of evidence to suggest that Illinois residents are not happy about the change.

A new report published by the Sports Betting Alliance suggests that there has been a double-digit decline (15.4%) in sports bets placed in the state in November, which was the focus of the report.

However, the drop is not just a blip on the radar, but rather a sustained trend with similar 15% drops registered in both September and October last year. In the meantime, House Bill 5143 does not seek to change anything else about the way sports gambling is taxed in the state.

The proposal is sponsored by Rep. Daniel Didech and Rep. Michael Kelly, and it summarizes as:

"Amends the Sports Wagering Act. Provides that the tax imposed on each master sports licensee for each wager placed with the master sports licensee for sports wagering over the Internet or through a mobile application shall end on July 1, 2026."

The bill does not explicitly cite any data about declining sports betting activity as the reason why it has been filed, but it is the most logical explanation.

In the meantime, Michigan’s governor, Gretchen Whitmer, has pitched a new proposal in her latest budget seeking to emulate Illinois’ per-wager taxation, arguing that her state has some of the lowest sports betting taxation in the United States.

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