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A bloc of Illinois House Democrats is urging the Chicago City Council to drop Mayor Brandon Johnson plan to extend the city 10.25 percent amusement tax to online sports wagers. The lawmakers warned that the move could raise prices for bettors, push activity to offshore gambling sites and damage state revenue streams already under stress.
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In a letter sent Thursday to every Chicago alderperson, the group argued that raising the cost of legal wagers could hurt both the city and state. They said more than 200 Illinois municipalities might follow Chicago and create their own wagering taxes, multiplying the financial impact and encouraging bettors to look elsewhere.
Representative Dan Didech, chair of the House Gaming Committee, described the concern clearly. He said:
“If you increase the tax so it becomes cost-prohibitive for gamblers, they will seek out overseas sites… That is a direct loss in tax revenue for the state.”
He added that many offshore books require bettors to transfer funds into cryptocurrency, leaving customers exposed. He said:
“A lot of these places require you to transfer your money to Bitcoin and cryptocurrency. Sometimes, winners get paid out. Sometimes they do not. Money is not kept in segregated players accounts. It is a much more predatory environment for players.”
The pushback arrives at a difficult moment for Mayor Johnson. His 2026 budget suffered a major setback when the City Council Finance Committee rejected the proposed corporate head tax, leaving a $100 million shortfall. If alderpersons also vote down the online wagering tax, the gap grows by another $26 million.
State legislators say the city proposal comes at the wrong time and could trigger political fallout. Representative Curtis Tarver, chair of the House Revenue Committee, noted that sports betting operators already deal with some of the toughest rates in the country. The state raised taxes twice in two years, moving from a flat 15 percent to a tiered structure of up to 40 percent and adding a tax applied to each bet.
Tarver said that adding a city level levy risks inflaming tensions and could prompt efforts to revisit Chicago home rule authority. He said lawmakers see the proposal as out of step with a sector that has already absorbed steep increases.
The letter signed by the 30 Democrats pointed to what they described as an ongoing communication gap between Chicago and Springfield. They said the sports betting tax idea appeared without early consultation and left even Chicago based lawmakers with no real path to support it.
Tarver said the friction reflects deeper issues with the administration legislative strategy. He criticized the mayor choice of former Alderman John Arena as chief lobbyist, arguing that the relationship building effort in Springfield has faltered. Tarver said:
“He seems to alienate everybody he comes into contact with… the more you are around him, the less you want to be around him.”
Several alderpersons echoed that view. Alderman Matt O Shea said the letter showed another breakdown in communication, adding that “there is no relationship.”
Alderman Gilbert Villegas said Chicago already missed a chance to secure a share of state sports betting tax revenue and urged the city to work closely with lawmakers to avoid getting “screwed later on.”