Fanatics Adds $0.25 Fee in Illinois

New Tax Sparks Fee Hike

Illinois introduced a unique per-wager tax on July 1, requiring sportsbooks to pay $0.25 for each of the first 20 million bets annually, then $0.50 per bet beyond that threshold.

Combined with last year’s shift from a 15% flat tax to a progressive 20-40% rate, top operators face effective tax rates of 57-60%, the highest in the U.S.

Therefore, Fanatics, like FanDuel and DraftKings, will pass a portion of this cost to customers. However, Fanatics’ $0.25 fee is half the $0.50 charged by its larger rivals, who expect to exceed the 20-million-bet mark and face the higher tax rate.

Fanatics’ smaller market share means it likely won’t hit the 20-million-bet threshold, keeping its state tax at $0.25 per wager. The company stated this fee, its first in any state, is necessary to offset Illinois’ steep operational costs.

If the state repeals the per-bet tax, Fanatics has pledged to remove the surcharge, mirroring commitments from FanDuel and DraftKings, who plan to start their $0.50 fees on September 1, 2025.

Industry and Customer Impact

The Sports Betting Alliance, representing Fanatics, FanDuel, DraftKings, and BetMGM, warns that the tax disproportionately harms small-stakes bettors, who face a 25-50% tax on modest wagers. As a result, some players may turn to unregulated platforms, which evade taxes and lack consumer protections.

For instance, Illinois bettors lost $1.12 billion in 2024, with $700 million on parlays, and added fees could further erode profitability.

Meanwhile, other operators like BetMGM, Caesars, bet365, BetRivers, Circa, ESPN Bet, and Hard Rock Bet have not announced similar fees, potentially eyeing market share gains.