Illinois Lawmakers Seek Higher Sports Betting Taxes as State Tops $1 Billion Since 2023
Updated
Updated · rg.org · Jul 16
Illinois Lawmakers Seek Higher Sports Betting Taxes as State Tops $1 Billion Since 2023
3 articles · Updated · rg.org · Jul 16
Summary
$612 million in FY26 sports-betting tax revenue, up from $393 million in FY25, is pushing Illinois lawmakers to propose another tax increase and new oversight for prediction markets.
The bill would treat prediction markets as exchange wagers under the Sports Wagering Act, subjecting them to the same 15% gross-revenue tax as traditional sportsbooks.
More than $1 billion has flowed to Illinois from sports-betting taxes since 2023, with the money feeding the general revenue fund for pensions, medical and human services programs.
May 2026 wagering volume still slipped from May 2025, and the Sports Betting Alliance says higher taxes are driving bettors toward neighboring states and less-regulated alternatives.
Kalshi is challenging the proposal in federal court, arguing CFTC oversight should preempt state regulation; the law will remain on hold until the Illinois case is resolved.