DraftKings has announced that it will begin charging Illinois customers a 50-cent fee on every online and mobile sports wager starting September 1, 2025. This new charge comes in response to a recently passed tax measure that significantly increases the financial burden on regulated sportsbook operators within the state.

The move from DraftKings follows a similar announcement by FanDuel earlier in the week. Both companies cited Illinois’ new per-wager tax as the reason for implementing the customer-facing fees. The new state legislation imposes a $0.25 tax on the first 20 million online bets an operator handles annually, increasing to $0.50 for each additional wager beyond that threshold.

Although the per-bet tax was quickly included in the state’s budget during a last-minute legislative push on May 31, it is still awaiting final approval by Governor J.B. Pritzker, who has indicated he will sign it into law. If enacted, the tax will take effect July 1, 2025.

Industry Concerns About the Impact of Tax Changes

The announcement from DraftKings echoed many of the concerns raised across the sports betting industry. “Illinois has been an important part of our growth, and we’re proud to have contributed meaningfully to the state through tax revenue, job creation, and a sustained investment in responsible gaming tools and resources,” said Jason Robins, Chief Executive Officer and Co-Founder of DraftKings. “We are disappointed that Illinois policymakers have chosen to more than triple our tax rate over the past two years, and we are very concerned about what this will do to the legal, regulated industry. Meanwhile, Illinois continues to fuel the rapidly growing illegal industry, which pays no taxes or fees and provides none of the consumer protections that regulated operators offer.”

FanDuel expressed similar frustrations, with Peter Jackson, CEO of its parent company Flutter, noting that the new fee structure would disproportionately affect small-scale recreational bettors and could drive them toward unregulated platforms. “We also believe the introduction of the Illinois Transaction Fee will likely motivate some Illinois-based customers to bet with unregulated operators,” Jackson said.

Potential Reversal if Legislation Changes

Both DraftKings and FanDuel have stated that they would remove the new fees if the per-bet tax is repealed. DraftKings confirmed that the 50-cent charge is designed specifically to offset the elevated tax liability introduced by the state’s fiscal year budget.

The Sports Betting Alliance (SBA), which represents major industry players including DraftKings, FanDuel, BetMGM, and Fanatics Sportsbook, criticized the legislation for unfairly targeting casual bettors. “A per bet tax most penalizes small recreational bettors — many of whom are betting a single dollar or two,” the SBA said. For example, FanDuel reported earlier this year that 90% of same-game parlays on its platform are for $30 or less, and 60% are for $5 or less.

Operators Caught in a Cost Squeeze

This is not the first time DraftKings has explored passing additional fees on to customers. In 2024, the company proposed a “gaming tax surcharge” on winning bets in several high-cost states, including Illinois. However, backlash from users led to the plan being shelved. The current decision to institute a flat fee per bet marks a notable shift, reflecting the company’s need to adjust its business model under the evolving tax landscape.

With the new legislation, tax rates for leading sportsbooks like DraftKings and FanDuel could reach as high as 60%, making Illinois one of the most expensive states for sports betting operations in the country. Smaller sportsbooks, such as Circa Sports, are now reevaluating their presence in the state. “I don’t know in Illinois if sports betting is viable in the current environment,” said Circa owner Derek Stevens.

Broader Implications for the Betting Market

Illinois is among several U.S. states reevaluating gambling taxation frameworks. DraftKings’ newly announced per-bet fee could set a precedent for other regulated operators dealing with rising tax burdens. While operators are not legally required to pass on these costs to customers, many, like DraftKings and FanDuel, see it as a necessary response to maintain financial sustainability.

Despite the changes, DraftKings says it remains committed to responsible gaming and industry collaboration. The company recently launched a new campaign with the UFC to promote its responsible gaming tools across media platforms. As the fee takes effect in September, Illinois bettors will face higher costs at the betting window—at least until lawmakers revisit the state’s sports wagering tax policy.