The state House and Senate have approved changes to the tax rate on sports betting, and now the governor must determine the final approval of the project.
United States.- Members of the Illinois House and Senate approved changes to the state tax rate on sports betting, which could double or even triple for certain operators. The HB 4951, part of the Illinois budget package, now heads to the desk of Governor J.B. Pritzker for final approval.
If enacted, the new rule would make the state, for companies in the highest income bracket, the second highest tax burden for the sector across the North American territory.
The bill would change the sports betting tax, which is currently 15 percent, to a new graduated format. The first USD 30m of adjusted gross revenues would be taxed at 20 percent; the next USD 20m at 25 percent; revenues between USD 50m and 100m would be taxed at 30 percent; from USD 100m to 200m at 35 percent and all revenues over USD 200m at 40 percent. The maximum rate would be the second highest among the states of the United States with competitive markets, after New York (which has a rate of 51 percent).
The Sports Betting Alliance (SBA) believes that the proposed measures “will cause real harm”. The president of the SBA, Jeremy Kudon, said: “Instead of paying attention to the protest of tens of thousands of residents who openly opposed more than doubling the taxes on sports betting, the Illinois Senate advanced tonight a budget that would make the Illinois sports betting tax the second highest in the country and counterproductively to sports betting operators who invested millions in the local economy and created jobs in the state”.
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Moreover, as highlighted by the entity: “Higher taxes are likely to worsen the situation for players. Customers will have access to fewer promotions and bonuses. A tax increase will increase illegal sports betting overseas”.
Following the announcement of the tax adjustment, companies operating in the territory of Illinois suffered a drastic decline in the value of their shares.
After the intention to raise taxes was known, the shares of Flutter Entertainment, owner of FanDuel, decreased in value by 7.7 percent, reaching a cost of USD 188.33.
