Lawmakers in Illinois have introduced a bill seeking to prohibit local authorities from implementing their own taxes on gambling. 

HB 4171 states that “The regulation and licensing of sports wagering, including, but not limited to, the imposition of fees, surcharges, or other costs for the privilege of conducting or participating in sports wagering, are exclusive powers and functions of the State.”

The bill goes on to say, “A home rule unit may not impose or collect a tax on sports wagering.” 

If enacted, it will stop Chicago from being able to impose a proposed 10.25% city tax on sports betting.

Rep. Daniel Didech, who is chair of the House Gaming Committee, introduced the bill, and commented, “When the legislature legalized sports betting in 2019, it was never our intent to allow local governments to create their own rules for this industry.”

“Chicago’s proposal will hurt consumers, drive vulnerable people to predatory illegal markets, and reduce state tax revenue. The city should work collaboratively with the state to ensure sound, informed policy decisions are made on this issue.”

The bill is co-sponsored by fellow Democrats Curtis J. Tarver, II, Angelica Guerrero-Cuellar, Edgar González, Jr., and Michael J. Kelly. 

Rep. Guerrero–Cuellar added, “We need to protect Chicago sports fans from unnecessary taxes and ensure players aren’t pushed toward illegal, unregulated markets.”

Chicago Mayor Eyes Sports Betting To Reduce Deficit

Chicago Mayor Brandon Johnson‘s newly released 2026 budget plan included the 10.25% tax, which would apply to wagers placed both online and at retail sportsbooks. 

The Chicago Financial Future Task Force, launched by Mayor Brandon Johnson, previously recommended that the city consider adding a betting surcharge for all online sports wagers placed within its borders.

This was slated to apply to bets placed online across all major sports, including esports. In its interim report, the task force stated, “Currently, the City taxes sports wagering at physical sports wagering facilities where only 2% of all sport betting occurs. The remaining 98% of sport betting occurs online and remains untaxed.”

An additional city surcharge on online bets was estimated to generate as much as $17 million per year. However, the proposed 10.25% tax is estimated to generate around $26 million. Mayor Johnson is aiming to cut a projected budget shortfall of $1.15 billion. 

Bettors Paying The Price For New Illinois Taxes

The Chicago tax would be in addition to the state-wide surcharge Illinois Governor JB Pritzker included in his budget earlier this year. 

As part of the new tax, sportsbooks are charged either $0.25 or $0.50 on every bet they accept in the state. 

In response to the new tax, sportsbooks have either passed the fee directly onto bettors or raised the minimum stake for wagers. 

Caesars Sportsbook was the latest to announce it will add a fee of $0.25 to all bets placed on the platform in Illinois from September. FanDuel, DraftKings, and Fanatics also chose to pass the cost on to their customers. 

Circa Sports ($10), BetMGM ($2.50), BetRivers ($1), ESPN Bet ($1), and Hard Rock Bet ($2) all chose to raise the minimum stake instead. 

Meanwhile, Governor Pritzker revealed last week that he had made over $1.4 million from gambling last year. The billionaire heir to the Hyatt hotel empire said he got “incredibly lucky” playing blackjack in Vegas.