Illinois bill proposes repeal of prediction markets tax
The state law imposing taxes on prediction market operators was enacted less than three months ago.
US.- Illinois Representative Travis Weaver has proposed a measure that would amend the Sports Wagering Act and repeal the new exchange wager transaction tax with immediate effect. The proposal is included in HB5811, which would leave the rest of the state’s sports wagering tax framework unchanged.
The state’ tax on prediction markets was introduced under Senate Bill 3019, approved as part of the 2027 budget legislation signed by Governor JB Pritzker. The legislation imposes a 1.75 per cent levy on each exchange wager, rising to 3.5 per cent once a platform exceeds five million wagers in a fiscal year. It also requires prediction market operators to obtain a master prediction market licence from the Illinois Gaming Board for a $1m fee.
Under HB5811, traditional sports betting operators would remain subject to a graduated tax ranging from 20 to 40 per cent on adjusted gross sports wagering receipts. Online sportsbooks also pay $0.25 for each of their first 20 million annual wagers, rising $0.50 from there on.
The Commodity Futures Trading Commission (CFTC) has filed a federal lawsuit against the state of Illinois’ bid to tax prediction market operators. It argues that the legislation is an attempt to regulate what it claims are federally designated contract markets. It claims this is preempted by the Commodity Exchange Act.
