DraftKings Implements Surcharge, Mirroring FanDuel's Strategic Move
Illinois Doubles Down on Taxing Sportsbooks, Leaving Customers to Foot the Bill
In a surprising move, Illinois has ratcheted up the tax rate sportsbooks pay, and now, you - the sports bettor - will be shouldering at least a portion of that cost.
Gone are the days when sportsbooks could deftly conceal the costs by lowering the value of their odds and offering less attractive deals. In the case of the Prairie State, they're taking a different approach: charging bettors directly.
The Hidden $0.50 Charge You'll Be Paying
First, FanDuel sounded the alarm, announcing that, in light of the new tax hike, they'd be forced to pass on costs to their customers. The result is a $0.50 surcharge on every bet, effective later this year. Despite initial derision when DraftKings floated a similar idea, both companies are now in agreement.
After FanDuel's declaration, DraftKings - who had been considering the move for a while - stepped up to the plate, confirming they too would levy a 50-cent transaction fee, starting September 1, 2025.
DraftKings CEO Jason Robins spoke candidly about the changes and the need for them.
"Illinois has been a key part of our growth, and we're proud to have made a meaningful contribution to the state through tax revenue, job creation, and a continuous commitment to responsible gaming tools and resources."
Similar to Peter Jackson, FanDuel's counterpart, Robins expressed disappointment that Illinois policymakers had tripled the tax in just two years, leading to this surcharge for players.
The Looming Burden on Bettors
The new law mandates that sportsbooks pay a $0.25 surcharge on the first 20 million wagers and $0.50 on anything above that volume. With this change, disgruntled punters may turn to offshore alternatives, foregoing the consumer protections offered in regulated markets.
DraftKings and FanDuel are essentially passing the tax onto their customers but have indicated a willingness to reverse the surcharge if Illinois reconsiders its taxation policy.
Image credit: Unsplash.com
In light of Illinois' increased tax rate for sportsbooks, sports betting platforms like FanDuel and DraftKings are imposing a $0.50 surcharge on every bet, a move that will directly impact sports bettors. Jason Robins, DraftKings CEO, acknowledged the changes, stating that Illinois' policy has contributed significantly to the company but regretted the tripling of taxes in two years, leading to this added cost for players.
