* InGame…
Flutter is not flitting about when it comes to the Illinois legislature adding its proposed 25-cent or 50-cent tax on each individual sports bet, announcing early Tuesday morning that, effective Sept. 1, FanDuel will be passing the charge along to its customers, instituting a $0.50 transaction fee on all wagers placed in Illinois.
While FanDuel won’t start charging until days before the kickoff to the NFL season, the state of Illinois isn’t waiting, with its per-wager tax kicking in July 1 (assuming Gov. JB Pritzker signs the budget sent to him). Clearly, the braintrust at Flutter — FanDuel’s parent company — is hoping the braintrust in Illinois will use those few months to rethink the decision, noting in a press release that if the state pulls back on the transaction tax, the company will immediately remove the fee being placed on bettors.
Click here for the press release.
* Daniel Koslovsky and Prabhdeen Kaur writing in Crain’s…
Online operators exploit behavioral biases — anchoring, overconfidence, the gambler’s fallacy — to coax consumers into wagering more than they intended. Stanford economists estimate behavioral biases are responsible for over 8% of what online sports gamblers wager. Moreover, online sports gambling is highly accessible, available to anyone with a smartphone at any time. Online sportsbooks rely heavily on aggressive marketing and promotions, familiar to any modern sports fan who is inundated by them whenever they watch a game on TV or in person. Odds are priced in confusing ways that require bettors to perform mental math to reveal the true price.
The results are predictably disastrous for the finances of bettors. A flurry of academic studies were released last year showing that consumers in states that legalized sports betting had less savings, more excessive debt, and overall worse financial health. One study estimated that annual net savings and investment fall by $144 per household after legalization. A back-of-the-envelope calculation suggests that Illinois lost $730 million in 2023 that could have gone to college savings, retirement accounts, or small business investment because of legalized sports gambling. Dwarfing the $150 million the state collected in tax receipts from sportsbooks.
Even Illinoisans who don’t participate in online sports betting feel the squeeze. Researchers at UCLA and the University of Southern California have shown that banks have tightened credit limits and lending standards on all consumers in states that have legalized online sports gambling to account for the extra risk presented by the abundance of betting. Meanwhile, public resources — counseling, fiscal support, family services — strain under the weight of problem gambling, eroding the very tax revenues that boosters tout.
* From the study mentioned in the highlighted passage above…
In this section, we study whether financial institutions responded to increased consumers’ financial risk by reducing credit card limits and limiting the type of loans they can take.
In Figure 4a, we present changes in the cumulative credit card limits for individuals with existing credit cards. We find that credit card limits start to decrease right after gambling legalization and continue to decrease as time passes. For general sports betting access, the overall ATT [Average Treatment on the Treated] estimate corresponds to roughly a 1.6% decline in credit card limits, while access to online betting leads to a nearly 2.7% decline. These results suggest that banks are responding to the increased financial risk caused by sports betting and lowering credit card limits to mitigate potential risk exposure. […]
While sports betting accessibility appears to be financially harming consumers, online access drives most of the effect we observe. Furthermore, the effect of sports betting does not appear to be driven by higher credit card delinquencies but by increased exposure and use of hard debts such as consolidation loans, secured loans, and bankruptcies. The fact that credit card delinquencies are unaffected or lower is likely due to financial institutions trying to mitigate their exposure to risk by lowering credit limits. Despite this, we observe consumers missing payments for other loans and products, leading to increased collections and auto loan delinquencies.
…Adding… Illinois Gaming Board…
Hi Rich,
Hope all is well with you.
We read with interest your blog post, Is online sports betting lowering credit limits for all Illinoisans?
The Illinois Gaming Board (IGB) approved a new rule at its April 24, 2025, meeting, to prohibit the use of credit cards to fund sports wagering accounts. This rule will soon be filed with JCAR.
During the meeting, IGB Administrator Marcus D. Fruchter said, “As part of our review, we determined that prohibiting the use of credit cards to fund sports wagering accounts is a justified and impactful advancement in Illinois sports wagering. There is a growing body of recent research showing that restrictions on credit usage to fund wagering accounts encourages responsible gambling and mitigates the harms of compulsive gambling. Problem gamblers are particularly at risk and studies have shown an often-problematic willingness for compulsive gamblers to use credit cards to place bets.
Here’s the press release.
- Joe Bidenopolous - Tuesday, Jun 10, 25 @ 1:09 pm:
A 50 cent fee per wager placed will hurt people already victimized by Fanduel. If you’re placing $100 wagers, maybe 0.5% on top isn’t that big a deal. But if you’re placing $5 bets with a 10% kicker, your success rate would have to be historic to not lose.
I just transferred all of the case out of my FanDuel account. I’ll close it if they open football season with a fee
- City Zen - Tuesday, Jun 10, 25 @ 1:10 pm:
==that could have gone to college savings, retirement accounts==
Every tax hike should be viewed through the same lens.
- We've never had one before - Tuesday, Jun 10, 25 @ 1:12 pm:
I feel a twinge of excitement and guilt when I buy a single lotto ticket, that’s enough.
“Gambling Problem? Call 1-800-I-Lost-It-All”
Gambling Problem? If you downloaded the app, you have a problem.
- Streator Curmudgeon - Tuesday, Jun 10, 25 @ 1:18 pm:
Just imagine being married to someone who is addicted to this stuff.
- Irreverent - Tuesday, Jun 10, 25 @ 1:23 pm:
@City
We’re not going to pretend with you that civilization doesn’t cost money.
- Thomas Paine - Tuesday, Jun 10, 25 @ 1:43 pm:
=== Every tax hike should be viewed through the same lens. ===
Let me tell you now that you do not want robust ROI study requirements for tax hikes, tax cuts and public spending.
For one thing it is going to tell you that $1000 spent on a child in the first year of its life always has a higher ROI than $1000 spent on a senior in the last year of their life.
For another it is always going to tell you that $1000 spent replacing lead pipes in schools provides more public benefit than a $1000 tax cut,
- Irreverent - Tuesday, Jun 10, 25 @ 1:49 pm:
@Thomas
You’re engaging in second-order thinking, with the expectation that the person to whom you’re talking is capable of the same.
You’ll be disappointed, but with a little luck, it will open your eyes to a glaring trend regarding who is and is not capable of second and third-order thinking.
- Matty - Tuesday, Jun 10, 25 @ 2:48 pm:
“Just imagine being married to someone who is addicted to this stuff.”
It’s easy to avoid when you don’t socialize with individuals who watch sports.
- City Zen - Tuesday, Jun 10, 25 @ 2:49 pm:
==civilization doesn’t cost money==
So those college savings and retirement accounts will certainly come in handy then.
==you do not want robust ROI study requirements for tax hikes==
Actually, I do. It’s called opportunity cost. Knowing what we’re foregoing in X in exchange for doing Y is the foundation of solid decision making.
- Garfield Ridge Guy - Tuesday, Jun 10, 25 @ 2:58 pm:
Every tax is passed onto the consumer. (This isn’t an anti-tax statement; it’s just how taxes work.) Similar to the Trump tariffs, consumers getting hit directly with the $0.50 tax is the intended outcome. I don’t really see a problem here to be fixed (other than immediately making all gambling illegal in Illinois, which is not in the cards).
- Irreverent - Tuesday, Jun 10, 25 @ 3:01 pm:
@City
Sure. We can replace civilization with personal savings. Absolutely brilliant.
The reason Thomas says you don’t want them is because they consistently demonstrate that defunding civilization is bad for all of us. You’ve already made up your mind that it’s what you want to do, though, regardless of what the data shows.
- Demoralized - Tuesday, Jun 10, 25 @ 3:11 pm:
==what we’re foregoing in X in exchange for doing Y==
Not everything is binary @City Zen, even though you like to always come with your binary arguments. It’s your go to on everything when it’s simply not always true.
- George - Tuesday, Jun 10, 25 @ 3:45 pm:
=Every tax is passed onto the consumer. (This isn’t an anti-tax statement; it’s just how taxes work.) Similar to the Trump tariffs, consumers getting hit directly with the $0.50 tax is the intended outcome. I don’t really see a problem here to be fixed=
It seems to me that the tax should have been a % of the wager not a flat amount. This is a big hit to people betting $5 for fun and trivial to people betting $500. I’m not sure why you’d want to set it up that way.
- Thomas Paine - Tuesday, Jun 10, 25 @ 3:58 pm:
@CityZen - Great man, lets do them.
You can start be reading the plethora of tax appropriations studies over the last 20 years that show little to no public benefit from general business tax incentives, just like with the Bears stadium proposal.
On this point, Ken Griffin and I agree.
- Lincoln Lad - Tuesday, Jun 10, 25 @ 4:52 pm:
Agree 100% with Joe Bidenopolous at 1:09. This increased tax hurts small bettors, many of whom may stop playing. One of two things will happen - small bettors stop playing, or they start betting larger amounts. Neither of these are good outcomes - and the tax could actually end up causing harm.
- Perrid - Tuesday, Jun 10, 25 @ 9:52 pm:
Stopping betting isn’t “harm” lol