Sports Betting Industry Pushes Back Against Illinois Tax Hike Proposal
Illinois legislators are racing against a self-imposed deadline to finalize the annual spending plan. Key issues include a proposed sports betting tax hike and changes to retailer discounts, as Governor J.B. Pritzker’s $52.7 billion budget proposal faces scrutiny from his own Democratic supermajorities.
Proposed Sports Betting Tax Increase
Pritzker’s proposal to increase the tax on sports betting revenue from 15% to 35% is a core point of contention. The governor anticipates this hike would generate an additional $200 million for the state.
However, the proposal has encountered resistance from both legislators and the sports betting industry. Lobbyists for major sportsbooks argue that such a steep increase could drive customers to illegal betting platforms due to less favorable odds.
The Sports Betting Alliance, which includes BetMGM, DraftKings, FanDuel, and Fanatics Sportsbook, has expressed strong opposition to the proposed tax increase. The coalition warns that such measures could have adverse effects on the industry and its customers.
State Rep. Curtis Tarver, D-Chicago, highlighted the challenges of implementing such a high tax rate on a relatively new industry.
Similarly, Rep. La Shawn Ford, D-Chicago, noted the tax hike as a major sticking point in the budget negotiations. Meanwhile, Pritzker’s office justifies the increase by pointing to higher tax rates in New York and Pennsylvania.
Broader Budget Concerns
Moderate Democrats have voiced worries about the overall spending in Pritzker’s budget, particularly with fiscal uncertainties looming. Additionally, Pritzker’s plan to eliminate the 1% grocery tax has faced opposition from local governments reliant on this revenue.
The budget discussions also include allocations for managing the influx of migrants from the southern U.S. border. Pritzker proposes $182 million, with additional funds pledged by Chicago and Cook County.
Republican lawmakers, led by Minority Leader Tony McCombie, R-Savanna, have criticized their exclusion from the budget talks. They argue that bipartisan engagement has diminished even further compared to previous years.
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