Illinois Advances Bill to Prevent Chicago Sports Betting Tax Hike
Posted on: February 19, 2026, 08:25h.
Last updated on: February 19, 2026, 08:25h.
- House committee moves bill to block Chicago sports betting tax increase
- If passed, it’d confirm that gaming tax power rests with state lawmakers
- Illinois raised sports betting taxes in 2024 and 2025
Illinois lawmakers may have finally met a tax increase they don’t like. On Wednesday, the Illinois House Gaming Committee advanced House Bill 4171 (HB 4171), which if passed, would bar the state’s home rule cities from implementing sports betting regulation policies of their own, including taxation.
Initially proposed by Rep. Daniel Didech (D), the chairman of the gaming committee, HB 4171 was introduced in response to Chicago Mayor Brandon Johnson’s (D) proposed sports betting tax of 10.25% on operator revenue generated in the Windy City. If Johnson’s plan stands, sports betting companies operating in Chicago would see their rates surge to nearly a third of receipts generated.
That’s because Illinois previously raised sports wagering tax in 2025 and 2024. Last year, the state implemented a new levy of 25 cents per wager on an operator’s first 20 million booked bets, with that rate doubling to 50 cents per bet for each wager placed after that initial 20 million. The year prior, Illinois went to a progressive tax system under which the largest operators by market share pay more in taxes than smaller rival.
Didech Acknowledges Prior Tax Increases
In a November letter to Chicago aldermen about the city’s sports betting tax gambit, Didech acknowledge the state’s aforementioned tax increases.
The Illinois General Assembly has already increased the state’s sports-betting tax twice in consecutive years—first from a flat 15 percent to a tiered rate as high as 40 percent, and then by adding a per-wager assessment,” he wrote. “Illinois now has one of the highest sports-betting tax burdens in the nation. Certainly, this was a tough vote to ensure that the state had the necessary revenues it needs to serve all those who live within our state. Therefore, we recognize the importance of finding revenue to provide services.”
He also pointed out that allowing home rule cities to set their own tax standards for state-regulated industries could set “dangerous precedent” while potentially fostering flimsy frameworks undermining consistency sought by laws passed at the state level.
“The ripple effect could extend far beyond gaming,” wrote the lawmaker. “These types of policies could open the door for a patchwork of local taxes in other state-controlled policy areas, making enforcement and compliance nearly impossible.”
Sports Betting Alliance Says More Taxes Reduce Bets
The Sports Betting Alliance (SBA), an industry trade group, is challenging Johnson’s tax scheme in court and appears to support the Didech bill.
The trade association notes that number of bets placed via regulated means in Illinois decline from September through November 2025 due to the aforementioned per bet tax. However, data indicate handle hasn’t suffered in material fashion.
“The data is a warning sign that Illinois’ patchwork of regulations has direct consequences to the state’s revenues as well as the public policy goals of responsible gaming,” the SBA said in a statement. “In the face of high taxes, players are migrating to illegal betting sites and bookies that are cheaper to play, operating without any regulation or consumer protections in place, and bringing in zero tax revenue to the state.”
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