Illinois Moves to Block Chicago Sports Betting Tax
Illinois state lawmakers are attempting to use new legislation to block Chicago’s plan to impose local taxes on sports wagering. The state’s position is a firm rejection of any local authority to tax the industry. State legislators introduced House Bill 4171 (HB 4171) as a direct response to the city’s proposal. The bill aims to protect the state’s authority over the rapidly growing betting market.
Legislating Exclusive State Control
The core goal of HB 4171 is to amend the state’s Sports Wagering Act. The bill explicitly seeks to codify that the licensing, regulation, and taxation of sports betting are the exclusive powers and functions of the State.
The legislation directly targets local governing bodies, including the city of Chicago and Cook County. It would restrict “home rule units” from imposing or collecting any fees, surcharges, or taxes related to sports wagering.
State Representative Dan Didech, Chairman of the House Gaming Committee, introduced the bill. He stated it was a “direct response” to the Chicago tax plan.
This move is intended to prevent an “unmanageable patchwork of local regulations.” Lawmakers stressed that the legislature’s intent in legalizing sports betting in 2019 was never to allow cities to create separate regulatory frameworks.
Consumer Harm and Illegal Market Risk
State lawmakers argue that a local tax would severely damage the legal sports betting market. The Chicago proposal includes a potential 50-cent per-wager charge on top of existing state taxes. Critics note this could create an effective tax rate of 100% on a bet.
Legislators warn that such high costs would “harm consumers” and push bettors toward unregulated platforms. Increased tax burdens can drive vulnerable players to predatory illegal markets that offer no player protection. This shift could also reduce state tax revenue as wagers move to illegal offshore operators.
The state’s move has bipartisan support. Several Democratic representatives from Chicago itself co-sponsored HB 4171, signaling internal city opposition to Mayor Brandon Johnson’s budget proposal.
The Illinois Attorney General and the Better Business Bureau have also cautioned that unregulated platforms lack consumer safeguards. HB 4171 will be taken up when the next legislative session starts on January 14, 2026.
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