Pritzker Looks To Casino Table Games For Budget Revenue Help

For the first time in three years, the sports betting industry looks like it can breathe easy when it comes to Illinois Gov. JB Pritzker’s budget. This time, it is casino operators who may have to write bigger checks to the state.

Pritzker unveiled his $57 billion budget proposal for Fiscal Year 2027 last Wednesday. The total is a modest 1.6% increase from the previous year. One of the more notable ways the governor plans on raising $589 million in new tax revenue is by aligning tax rates on table games to those of slot machines across the state’s 17 casinos.

The other notable proposal in the budget is to merge the Illinois Gaming Board (IGB) and Illinois Racing Board (IRB) into a new Department of Gaming Regulation and Enforcement. There is currently no corresponding legislation for the proposal, though HB 5702 currently in the House seeks to create the position of an Illinois gaming oversight officer.

Seeking progressive taxes on table games

Sports betting operators bore the brunt of Pritzker’s budget wishes for Fiscal Years 2025 and 2026. The former brought the nation’s first truly progressive tax rates to the industry, going from a flat 15% fee on adjusted gross revenue (AGR) to rates ranging from 20% to 40% based on AGR thresholds.

Last year brought the much derided per-wager surcharge, also a novel tax in the United States. There is currently a bill submitted by Gaming Chairman and state Rep. Daniel Didech to repeal the tax for the upcoming fiscal year, but lawmakers can say it got the job done: The $62.2 million raised in the first six months of Fiscal Year 2026 is already 50% more than the $40 million estimated.

Slot and table games revenue are taxed by two different methods in Illinois. Slot revenue taxes are progressive, with a floor of 15% to a ceiling of 50% based on revenue thresholds.

In 2020, Pritzker passed PA 101-0648, which simplified table games taxes to two rates — 15% for the first $25 million AGR and 20% above $25 million. That law also restructured tax rates for any potential Chicago casino, which faced an effective tax rate above 70% when counting city and state levies.

Pritzker is seeking to bring the slots’ progressive rates to table games in hopes it will generate $120 million in revenue. Those rates retain the 15% floor for the first $25 million in operator AGR winnings and can reach up to 50%.

Three casinos would currently be subject to rates above the current higher 20% rate: Rivers Casino in Des Plaines just outside of Chicago, Wind Creek Casino in the Cook County suburbs south of Chicago, and Bally’s temporary casino in downtown Chicago.

Rivers, which is the dominant operator for table games and currently accounts for nearly half of the state’s revenue from the felt, would already be at the 37.5% rate with $107.4 million AGR. Bally’s, which may or may not be able to open its permanent venue in River West on time in the fourth quarter of this year, would be at 22.5% having surpassed $25 million AGR.

Wind Creek would also be remitting taxes at the 22.5% rate. Two other venues — The Temporary in Waukegan and Grand Victoria Casino in Elgin — could reach the 22.5% rate before the end of the fiscal year.

A merging of state agencies?

Pritzker’s proposal to merge the IGB and IRB comes at a time when the horse racing industry in Illinois is on shaky ground. While Fairmount Park in the western part of the state near the Missouri border has taken steps toward becoming a full-on racino, the same cannot be said of Hawthorne Race Course in the Chicago suburb of Stickney.

The IRB late last month suspended Hawthorne’s harness racing license for a “failure to provide documentation demonstrating its financial integrity,” and it remains uncertain if the upcoming thoroughbred season will run as scheduled.

The Carey family, which has owned the track for multiple generations, has struggled for years to secure the $400 million needed to build a racino after being declared “preliminarily suitable” to do so by the IGB in 2020. Hawthorne is still licensed to offer retail sports betting at its track and three off-track betting locations in the Chicagoland area.

What would the oversight officer do?

State Rep. Yolanda Morris’ bill would create the position of Illinois gaming oversight officer as part of the IGB. The officer would serve under the IGB administrator and have the following duties:

• Make recommendations for policy, statute, and rule changes
• Collect data regarding the regulation of gaming and exempted or quasi-gaming
• Compile or assist in the compilation of any reports
• Ensure the coordination of efforts between various state agencies involved in regulating and taxing gaming and exempted or quasi-gaming in the state
• Encourage, promote, suggest, and report best practices for ensuring diversity in the gaming and exempted or quasi-gaming industry in the state

Morris’ bill also contains language that would amend the Video Gaming Act. It seeks to protect potential license applicants from being denied or rejected licenses for having certain gaming devices provided the gaming device is in compliance with and not considered gambling under the Criminal Code of 2012.

This language is in other bills as the city of Chicago moves forward in having video gaming terminals (VGTs). They were legalized by the 2026 city budget as a means of helping to plug a $1.1 billion shortfall.