FanDuel Adds Surcharge to Illinois Bets Due to New State Taxes

New Surcharge on Illinois Sports Bets

• 💰 FanDuel is implementing a 50-cent surcharge on every wager made in Illinois to offset new state taxes.
• ⚠️ This move comes after Illinois instituted a new budget with taxes that disproportionately affect major sportsbooks like FanDuel and DraftKings.

Illinois's New Tax Structure

• 📊 The new tax imposes a 25-cent charge on the first 20 million wagers and 50 cents thereafter for sportsbooks.
• 🎯 Only FanDuel and DraftKings, which hold approximately 75% of the Illinois market, are expected to reach this threshold.
• 📈 Analysts estimate this fee could generate $79 million for DraftKings and $86 million for FanDuel annually.

Impact of Previous Taxes and Consumer Backlash

• 💸 The new surcharge is in addition to a progressive tax passed last year, which increased taxes for successful sportsbooks from 15% to 40%.
• 🗣️ When DraftKings attempted to pass on previous tax costs to consumers, they faced significant backlash and reversed their decision.

Concerns Over Unregulated Operators and Recreational Bettors

• 📉 Flutter CEO Peter Jackson stated the tax unfairly penalizes companies that invested in the regulated market.
• 🚫 He warned that the fee could drive gamblers to unregulated operators who do not pay taxes and lack consumer protections.
• 🧑‍💻 The tax is particularly problematic for recreational customers who make smaller bets, as a 50-cent charge can be a significant portion of their wager.