ILLINOIS — Starting September 1, bettors in Illinois using FanDuel will be charged a $0.50 transaction fee per bet, as the sportsbook responds to a new tax passed last week by state lawmakers.
The move follows a quiet late-night legislative vote in Springfield that imposed a new tiered tax on sports wagers. Under the new law, sportsbooks will pay a $0.25 tax on the first 20 million bets annually, and $0.50 per bet for all bets beyond that.
FanDuel’s parent company, Flutter Entertainment, announced Tuesday morning that the fee will go directly to bettors — marking a significant change in how tax burdens are passed on in the sports betting industry.
FanDuel Says Recreational Bettors Will Be Hit Hardest
In a statement published by Front Office Sports, Flutter CEO Peter Jackson criticized the tax’s design, arguing that it would disproportionately affect small-bet, recreational gamblers.
“We are disappointed that the Illinois Transaction Fee will disproportionately impact lower wagering recreational customers while also punishing those operators who have invested the most to grow the online regulated market in the state,” Jackson said.
He further added that players making low-dollar bets — such as $2 parlays — will effectively be paying a 25% fee per wager.
Concerns About Offshore Market Migration
FanDuel leadership also warned that higher state-imposed fees may drive customers to offshore, unregulated sportsbooks that do not offer consumer protections or legal recourse.
“There is an optimal level for gaming tax rates that enables operators to provide the best experience for customers, maximize market growth, and maximize revenue for states,” Jackson emphasized.
Industry Reaction: Will Other Operators Follow?
As the largest sportsbook in the U.S. market, FanDuel’s move could set the tone for the rest of the industry. While other platforms like DraftKings have not announced similar changes, experts believe more fees could follow if operators feel squeezed by state tax codes.
In 2023, DraftKings floated a similar “winners’ surcharge” in high-tax states like Illinois and New York, but walked it back after facing backlash from users.
A DraftKings spokesperson did not immediately respond to questions about whether the company plans to implement a fee in Illinois.
Why Illinois Is Being Watched Closely
Illinois has quickly become one of the top sports betting markets in the country, but its increasing tax burdens are now raising alarms for operators. Industry leaders argue that such taxes could:
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Discourage casual betting participation
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Increase costs for users
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Slow market growth
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Drive activity underground
Flutter and other major players have warned that legislative unpredictability could destabilize future investment in the state.
Will This Fee Change How You Bet?
Will the new $0.50 fee per wager affect your betting habits? Do you think Illinois went too far with this tax? Let us know on ChicagoSuburbanFamily.com.
