{"id":246,"date":"2024-06-25T21:09:15","date_gmt":"2024-06-25T18:09:15","guid":{"rendered":"https:\/\/spindimensionnodepositbonus.icu\/2024\/06\/25\/illinois-gambling-tax-hike-sends-draftkings-and-fanduel-stocks-plunging\/"},"modified":"2024-06-25T21:09:15","modified_gmt":"2024-06-25T18:09:15","slug":"illinois-gambling-tax-hike-sends-draftkings-and-fanduel-stocks-plunging","status":"publish","type":"post","link":"https:\/\/spindimensionnodepositbonus.icu\/2024\/06\/25\/illinois-gambling-tax-hike-sends-draftkings-and-fanduel-stocks-plunging\/","title":{"rendered":"Illinois Gambling Tax Hike Sends DraftKings and FanDuel Stocks Plunging"},"content":{"rendered":"<p><iframe loading=\"lazy\" width=\"800\" height=\"450\"\n    src=\"https:\/\/www.youtube.com\/embed\/eIuV2v6MIlM\"\n    frameborder=\"0\"\n    allow=\"accelerometer; encrypted-media; gyroscope; picture-in-picture\"\n    allowfullscreen><br \/>\n<\/iframe><\/p>\n<p>DraftKings and Flutter Entertainment, the parent organization of FanDuel, witnessed a decline in their share prices on May 28th due to a negative response from the US market to a suggested increase in gambling taxes in Illinois.<\/p>\n<p>The stocks of DraftKings and Flutter plummeted as a result of the proposed increase in gambling taxes in Illinois.<br \/>\nIllinois legislators deliberated on the tax increase during the weekend&#8217;s 2025 budget session. Although the plan has not yet been formally approved, the potential price surge has already impacted key operators, including DraftKings and Flutter.<\/p>\n<p>The current proposition involves replacing the existing flat tax rate of 15% with a tiered betting tax framework. This would result in a tax rate ranging from 20% to 40%, contingent upon each operator&#8217;s adjusted gross revenue (AGR).<\/p>\n<p>Licensed operators with an annual AGR of $30 million (\u00a323.5 million\/\u20ac27.6 million) would be subject to a 20% tax rate. However, if an operator reports revenue exceeding $200 million, they would face a 40% tax rate &#8211; a 167% increase from the current rate. This would be the second highest tax rate in the US, trailing only New York&#8217;s 51%.<\/p>\n<p>Additional thresholds include: a 25% tax rate for AGR between $30 million and $50 million, a 30% tax rate for AGR between $50 million and $100 million, and a 35% tax rate for AGR between $100 million and $200 million.<\/p>\n<p>Leading operators like DraftKings and FanDuel would be eligible for the highest tax rate in Illinois. <\/p>\n<p>While the plan is still awaiting approval, the proposed tax hike had a noticeable effect on operators during Tuesday&#8217;s trading session, as the US was closed on Monday for the Memorial Day holiday.<\/p>\n<p>DraftKings and Flutter&#8217;s share prices took a dip at the close.<\/p>\n<p>The effects of these proposals were immediately apparent on DraftKings and Flutter after the market opened yesterday, both of which have extensive operations in Illinois.<\/p>\n<p>Beginning with Flutter, which ended the weekend at $204.11, its share price dropped to $196.64 within half an hour of the start of trading yesterday, a decline of 3.7%.<\/p>\n<p>Flutter&#8217;s share price continued to decline throughout the day, eventually closing in the US at $188.33. This represented a 7.7% decrease from the closing price on Friday evening before the extended weekend.<\/p>\n<p>Regarding long-standing competitor DraftKings, the trading pattern on Tuesday was similar. DraftKings finished last week at $40.75, but fell to $35.88 within an hour of the market opening on Tuesday, a drop of 12.0%.<\/p>\n<p>DraftKings did experience a degree of recovery during the remainder of the day. However, its closing price of $36.61 was still 10.2% lower than Friday afternoon.<\/p>\n<p>How do market experts view the Illinois tax?<br \/>\nIn response to the market movements and the proposed tax increase, Truist analysts stated that it was unclear how operators would react. However, analysts did outline how a higher tax rate would affect current Illinois licensees.<\/p>\n<p>Based on data from fiscal year 2023, both FanDuel and DraftKings fall into the 40% tax rate category. <\/p>\n<p>FanDuels adjusted gross revenue (AGR) is $480 million, necessitating an additional $102 million in taxes, whereas DraftKings&#8217; AGR is $312 million, requiring an extra $78 million in taxes.<\/p>\n<p>The tax hike will have a less substantial, but still significant, effect on other operators in the state. Rush Street Interactive&#8217;s tax rate is 30%, implying they will pay an extra $12 million on their $82 million AGR reported in the 2023 fiscal year. BetMGM ($43 million AGR), Penn Entertainment ($38 million AGR), and Caesars ($33 million AGR) will all fall into the 20% tax bracket.<\/p>\n<p>While experts suggest this could present opportunities for smaller operators to gain ground on DraftKings and FanDuel, it could also raise broader concerns, especially if other states follow suit and increase taxes.<\/p>\n<p>Over the past year, legislators in several states have considered raising gambling taxes. However, thus far, only Ohio lawmakers have taken action. Last week, Massachusetts lawmakers rejected a proposal to increase the tax rate from 20% to 51%.<\/p>\n<p>Truist analysts stated, &#8220;A tiered tax structure could create opportunities for smaller players to gain some market share at the expense of the two major players, while still maintaining a relatively low tax rate.&#8221;<\/p>\n<p>&#8220;That being said, DraftKings and FanDuels dominance is partly attributable to their technological products, not just promotions\/odds. Of course, there is a broader risk that more states will increase taxes, which could be progressive or not.&#8221;<\/p>\n<p>Will the tax increase fuel illegal wagering? <\/p>\n<p>Nevertheless, a different cause for concern is that this might result in authorized operators providing fewer incentives in Illinois, pushing more players towards unauthorized websites that offer such incentives but operate without licenses and are therefore not bound by tax regulations.<\/p>\n<p>Experts cited a recent statement from the Sports Betting Coalition, a group of leading operators including FanDuel, DraftKings, and BetMGM, expressing disapproval of the proposed price increases and their potential to compel players to resort to unauthorized operators.<\/p>\n<p>\u201cWe aim to address one aspect of the Coalition\u2019s response, which is that we believe states underestimate the prevalence of the illicit market, which legal operators are vigorously competing against,\u201d stated Truist analysts.<\/p>\n<p>\u201cA recent survey we conducted of online sports bettors revealed that 31% of respondents wagered offshore, although 71% of high-value players do so. This data aligns with what we previously obtained from Juice Reel, which found that offshore betting companies account for 18% of the total tracked bets on the platform, despite accounting for 46%\/50% of online sports betting volume\/revenue.\u201d<\/p>\n<p>Sign up for the iGaming newsletter. <\/p>\n","protected":false},"excerpt":{"rendered":"<p>DraftKings and Flutter Entertainment, the parent organization of FanDuel, witnessed a decline in their share prices on May 28th due to a negative response from the US market to a&hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.8 (Yoast SEO v22.8) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Gambling Tax Hike Shakes Up DraftKings &amp; FanDuel<\/title>\n<meta name=\"description\" content=\"Illinois\" class=\"yoast-seo-meta-tag\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/spindimensionnodepositbonus.icu\/2024\/06\/25\/illinois-gambling-tax-hike-sends-draftkings-and-fanduel-stocks-plunging\/\" class=\"yoast-seo-meta-tag\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" class=\"yoast-seo-meta-tag\" \/>\n<meta property=\"og:type\" content=\"article\" class=\"yoast-seo-meta-tag\" \/>\n<meta property=\"og:title\" content=\"Illinois Gambling Tax Hike Sends DraftKings and FanDuel Stocks Plunging\" class=\"yoast-seo-meta-tag\" \/>\n<meta property=\"og:description\" content=\"Illinois\" class=\"yoast-seo-meta-tag\" \/>\n<meta property=\"og:url\" content=\"https:\/\/spindimensionnodepositbonus.icu\/2024\/06\/25\/illinois-gambling-tax-hike-sends-draftkings-and-fanduel-stocks-plunging\/\" class=\"yoast-seo-meta-tag\" \/>\n<meta property=\"og:site_name\" content=\"Your Source for Trusted Casino News &amp; Licensed Gaming Experience\" class=\"yoast-seo-meta-tag\" \/>\n<meta property=\"article:published_time\" content=\"2024-06-25T18:09:15+00:00\" class=\"yoast-seo-meta-tag\" \/>\n<meta name=\"author\" content=\"admin\" class=\"yoast-seo-meta-tag\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" class=\"yoast-seo-meta-tag\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" class=\"yoast-seo-meta-tag\" \/>\n\t<meta name=\"twitter:data1\" content=\"admin\" class=\"yoast-seo-meta-tag\" \/>\n\t<meta name=\"twitter:label2\" content=\"Estimated reading time\" class=\"yoast-seo-meta-tag\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" class=\"yoast-seo-meta-tag\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/spindimensionnodepositbonus.icu\/2024\/06\/25\/illinois-gambling-tax-hike-sends-draftkings-and-fanduel-stocks-plunging\/\",\"url\":\"https:\/\/spindimensionnodepositbonus.icu\/2024\/06\/25\/illinois-gambling-tax-hike-sends-draftkings-and-fanduel-stocks-plunging\/\",\"name\":\"Gambling Tax Hike Shakes Up DraftKings & FanDuel\",\"isPartOf\":{\"@id\":\"https:\/\/spindimensionnodepositbonus.icu\/#website\"},\"datePublished\":\"2024-06-25T18:09:15+00:00\",\"dateModified\":\"2024-06-25T18:09:15+00:00\",\"author\":{\"@id\":\"https:\/\/spindimensionnodepositbonus.icu\/#\/schema\/person\/7fe3f8540cfe191b1464d5c1c2f0a7f0\"},\"description\":\"Illinois\",\"breadcrumb\":{\"@id\":\"https:\/\/spindimensionnodepositbonus.icu\/2024\/06\/25\/illinois-gambling-tax-hike-sends-draftkings-and-fanduel-stocks-plunging\/#breadcrumb\"},\"inLanguage\":\"en-GB\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/spindimensionnodepositbonus.icu\/2024\/06\/25\/illinois-gambling-tax-hike-sends-draftkings-and-fanduel-stocks-plunging\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/spindimensionnodepositbonus.icu\/2024\/06\/25\/illinois-gambling-tax-hike-sends-draftkings-and-fanduel-stocks-plunging\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Homepage\",\"item\":\"https:\/\/spindimensionnodepositbonus.icu\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Illinois Gambling Tax Hike Sends DraftKings and FanDuel Stocks Plunging\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/spindimensionnodepositbonus.icu\/#website\",\"url\":\"https:\/\/spindimensionnodepositbonus.icu\/\",\"name\":\"Your Source for Trusted Casino News &amp; Licensed Gaming Experience\",\"description\":\"Indulge in the excitement of licensed online gambling with the help of our up-to-date casino news, comprehensive reviews, and expert articles. 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