Illinois Senate Approves 40% Sports Betting Tax Hike, DraftKings and Flutter Shares Fall

May 28, 2024, 09:28 AM

The Illinois Senate has approved a significant increase in the sports betting tax rate on May 26th, which will now be structured progressively, topping out at 40% for operators with the highest adjusted gross revenue (AGR). This new tax structure, outlined in HB 4951, is nearly three times the current rate and has caused notable market reactions. DraftKings, FanDuel, and Flutter shares have fallen sharply, with DraftKings down by 12% and Flutter by 7%. The Senate's decision has been met with criticism from industry stakeholders, including the Sports Betting Alliance, which labeled the move as 'extremely disappointing' and warned of potential harm to the industry. The progressive tax rate was proposed as an alternative to Governor Pritzker’s call for a raise to 35%. The bill now heads to the House for concurrence.