DraftKings Follows FanDuel, Implements Illinois Surcharge
Posted on: June 12, 2025, 05:30h.
Last updated on: June 13, 2025, 09:48h.
- DraftKings to implement per bet levy of 50 cents in Illinois
- Rival FanDuel announced the same fee in the state earlier this week
Expressing disappointment that Illinois has tripled its tax rate over the past two years, DraftKings (NASDAQ: DKNG) said Thursday it will implement a surcharge of 50 cents on each online sports bet placed in the state, effective September 1.
The Boston-based company made the announcement two days after rival Flutter Entertainment (NYSE: FLUT), the parent of FanDuel, said it would charge 50 cents per wager in response to Illinois’ latest sports betting tax hike. DraftKings co-founder and CEO Jason Robins didn’t mince words regarding the state’s sports betting tax gambits.
We are disappointed that Illinois policymakers have chosen to more than triple our tax rate over the past two years, and we are very concerned about what this will do to the legal, regulated industry,” he said in a statement. “Meanwhile, Illinois continues to fuel the rapidly growing illegal industry, which pays no taxes or fees and provides none of the consumer protections that regulated operators offer.”
Earlier this month, Illinois announced a new sports betting tax under which operators will be subject to a levy of 25 cents per wager on the first 20 million bets they book, with that figure doubling to 50 cents once the 20 million threshold is exceeded.
DraftKings, FanDuel Paying a Price for Illinois Access
Illinois is the sixth-largest state by population, but with online sports betting not permitted in California and Texas and the Seminole Tribe holding a monopoly over that form of wagering in Florida, Illinois is the third-largest state in the US with a competitive internet sports wagering market.
In other words, companies such as DraftKings and FanDuel need to operate there, but that duo are bearing the brunt of the state’s sports betting tax policy. In a note out earlier this month, Truisit Securities analyst Barry Jonas estimated that if the new tax had been effect over the trailing 12 months, DraftKings and FanDuel would have paid an additional $68 million and $77 million, respectively.
The new levy comes after Illinois moved to a graduated sports wagering tax scheme last July under which the largest operators, meaning DraftKings and FanDuel, pay higher taxes than their smaller market-share competitors.
Robins acknowledged Illinois has been “an important part” of his company’s growth, but some analysts say the state’s new per bet tax assessed to operators could trim some gaming companies’ earnings there. DraftKings and FanDuel are part of that group.
Surcharge Optics Aren’t Good
In the days since it announced its Illinois surcharge, FanDuel has been derided on social media and in sports wagering circles, confirming that bettors don’t like the idea of the operators’ tax obligations being passed onto them.
DraftKings likely knows a similar fate awaits it because last August, the company announced a plan to add transaction fees in Illinois, New York, Pennsylvania, and Vermont — an effort that was ultimately pulled because no competitors went along with it. DraftKings said it’s open to working with Illinois on constructive policy solutions.
“DraftKings continues to support collaborative policymaking that works for the state and allows for the long-term sustainability of the industry,” according to the press release. “Should the legislation be repealed, the company will immediately remove the Illinois-specific per wager transaction fee.”
Last Comment ( 1 )
So now you're just not competing against the vig, which surely will increase as tax rates increase, but now you will pay a fee for the privilege of betting on sports. To me, this isn't a good deal and I would find another pastime for my entertainment dollar.