Chicago Could Possibly Charge 50 Cent Fee on Digital Sports Wagers

Sports betting in Illinois could be facing yet another round of tax pressure, this time from the city of Chicago. A proposal from the Chicago Financial Future Task Force, created by Mayor Brandon Johnson, suggests charging 50 cents on every online sports wager placed within city limits.

Good to Know

• Chicago officials estimate the new tax could raise around $17 million each year.
• Illinois already introduced a per-bet tax at the state level earlier this summer.
• Operators say layering another fee could double the tax burden on small wagers.

Chicago’s task force argues that the move is fair because the city only taxes physical sportsbooks right now, which account for just 2% of bets. Online betting, making up the other 98%, currently goes untaxed at the city level.

The problem? The state only just rolled out its own per-wager fee in July, adding to a recent tax hike that raised sportsbook revenue rates up to 40%. Now, with Chicago eyeing its own fee, industry operators are sounding alarms.

Sports Betting Alliance Issues Warning

The Sports Betting Alliance (SBA)—which includes BetMGM, bet365, DraftKings, Fanatics, and FanDuel—issued a sharp warning in a press release. The group said an extra city levy stacked on top of the state fee would be a direct hit on bettors.

“If adopted, a $1 bet placed in Chicago would come with a 100% tax rate of $1,” the SBA stated.

Operators argue that Illinois bettors are already covering costs tied to the state’s per-wager tax, since most sportsbooks now offset that by adding minimum bet requirements or transaction charges. An added city tax, they say, makes small wagers even less viable.

Offshore Markets in Play

The SBA also highlighted another concern: bettors turning to illegal offshore platforms. According to the group, more than half of Illinois wagers are for $5 or less. Stacking multiple per-bet taxes onto small stakes could drive customers toward “cheaper, illegal markets” that lack safeguards.

“Unregulated, offshore operators offer cheaper sports betting alternatives for consumers, without any protections – including age verification – and without any oversight, not to mention no tax revenue whatsoever,” the SBA added.

Industry leaders fear that repeated tax increases could reverse Illinois’ progress in building a legal, regulated market—one that has been generating reliable revenue for both the state and operators.

Chicago officials are weighing the proposal as part of broader efforts to tackle a projected $1.1 billion city deficit. The task force believes taxing the fast-growing online betting sector could deliver steady cash flow. But with operators and players already pushing back hard against state-level taxes, city leaders may have to tread carefully.

For now, sportsbooks active in Illinois are lobbying aggressively against the plan, while bettors themselves continue voicing frustration online and to lawmakers. With more than 100,000 resident contacts already sent opposing the state tax, Chicago’s latest idea is unlikely to slide through quietly.