The City of Chicago collected more than $3.3 million in sports betting taxes for February according to a fulfilled Freedom of Information Act request submitted to the city’s Finance Department by InGame.
The 10.25% tax on city-based adjusted gross revenue (AGR) for operators took effect Jan. 1 with the budget passed by the City Council. Mayor Brandon Johnson initially proposed the levy in his budget, but the final version that retained the tax — and legalized video gaming terminals for the city — was passed without his signature after he lost control of the process to the council.
The city has collected more than $7 million in receipts the first two months the tax has been in place, well above $26 million estimated annually when the budget was originally submitted. That figure was based on an estimate the city generated 40% of Cook County sports betting revenue, but that percentage surpassed 60% in February.
One bill to declare the tax illegal filed by state Rep. and House Gaming Chair Committee Daniel Didech is currently on second reading in the lower chamber and faces a Friday crossover deadline for passage to be considered by the Senate. A second bill that would reduce city funding from the state by the exact amount Chicago collects via the sports betting tax has an April 24 deadline to be heard in the Senate’s Gaming, Wagering, and Racing Committee.
The Second City is first in state revenue
The reverse math based on the tax figure provided by the Department of Finance and the 10.25% rate shows sportsbooks generated close to $32.5 million in AGR for February. That is 60.6% of the $53.6 million AGR generated in Cook County and nearly 30% of all state AGR as reported by the Illinois Gaming Board (IGB) on Tuesday as part of overall state figures.
Chicago-based wagering has generated $68.9 million in operator revenue the first two months of 2026. That accounts for 57.2% of the $120.4 million in Cook County revenue and 27.8% of Illinois sportsbook winnings.
Accounting for FanDuel and DraftKings
The fulfilled FOIA did not include revenue collected per operator, but applying the 30% figure to the IGB’s operator AGR figures as an estimate, DraftKings surpassed $12 billion in city-based revenue, while FanDuel reaped $11.1 million in winnings. That also means both operators potentially remitted more than $1 million to the city as part of their tax payments for the month.
Both digital giants are paying the maximum 40% state tax rate on their respective AGR, which means they are paying a 52.25% tax on Chicago-based revenue. When adding this city-based tax revenue estimate, DraftKings paid an effective tax rate of 44% on revenue, while FanDuel’s levy was 44.1%.
But with both operators also paying the state’s higher 50-cent-per-wager surcharge, having long surpassed the 20 million wager threshold for the fiscal year, the duo’s total effective tax rate spirals higher still. DraftKings and FanDuel each remitted more than $3.5 million in February for that tax as they continue to shoulder an outsized burden of the much-derided levy.
The $3.8 million tax bill for FanDuel lifted its overall estimated tax rate for February to 54.3%, while the $3.6 million for DraftKings raised its rate to nearly 53%. The estimated city taxes potentially increased total tax payments for each operator to more than $20 million for all Illinois-based revenue.
