Chicago's Sports Betting Tax Sparks Backlash from State Lawmakers

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Chicago has implemented a steep new tax on sports betting, which is creating a backlash in the state capital of Springfield. State lawmakers are now considering new restrictions that would limit the ability of municipalities to tax gambling revenue, arguing that the legislature never intended for there to be a "patchwork" of different rules and tax rates across the state.

Why it matters

The dispute over Chicago's sports betting tax highlights the ongoing tensions between local and state control over taxation and regulation of the gambling industry. As sports betting continues to expand across the country, states and municipalities are grappling with how to balance revenue generation with consumer protections and industry oversight.

The details

Chicago's new tax on sports betting charges a 2% tax on all bets placed within city limits, on top of the state's existing 15% tax. This has led to concerns from state lawmakers that the city is unfairly profiting from sports betting at the expense of the rest of Illinois. State legislators are now considering proposals that would restrict the ability of municipalities to levy their own taxes on gambling revenue, arguing that a patchwork of different rules undermines the intent of the state's sports betting law.

• Chicago implemented its 2% sports betting tax in January 2026.
• State lawmakers in Springfield are currently debating proposals to limit municipal taxation of gambling revenue.

What’s next

State lawmakers in Springfield are expected to vote on proposals to limit municipal taxation of sports betting and other gambling revenue in the coming weeks.