TLDR
- Illinois Rep. Travis Weaver filed HB5814 to repeal taxes and rules tied to sports wagering and fantasy contests.
- The bill would remove the exchange wager transaction tax, which currently ranges from 1.75% to 3.5%.
- Fantasy contest operators would lose their privilege tax and licensing framework under the bill.
- Legal protection that shields fantasy contest players from gambling charges would also be removed.
- Illinois’ main 15% sports wagering tax and tiered privilege tax rates would stay unchanged.
Illinois Rep. Travis Weaver has introduced a new bill aimed at rolling back taxes and rules connected to sports wagering and fantasy contests. The legislation is called HB5814 and covers the 2025 and 2026 sessions of the 104th General Assembly.
The bill targets three main areas. These include the exchange wager transaction tax, the privilege tax on fantasy contest operators, and the rules that classify fantasy contests separately from gambling.
If passed, the bill would take effect right away. Weaver is a Republican lawmaker who has been active on gambling tax issues in recent weeks.
What Happens to the Exchange Wager Tax
Illinois currently taxes exchange wagers under the Sports Wagering Act. The rate starts at 1.75% per transaction.
That rate rises to 3.5% once a licensee processes more than five million exchange wagers in a single fiscal year. The money collected goes into the Sports Wagering Fund each month.
Weaver’s bill would strike this tax section completely. The definition of an exchange wager would remain in the law, but the tax attached to it would be gone.
An exchange wager covers agreements, contracts, or swaps tied to a sporting contest. These are often traded through prediction markets or exchanges.
The bill leaves the core sports wagering tax structure untouched. The 15% tax on adjusted gross sports wagering receipts stays in place.
A separate 2% tax also remains for wagers placed within home rule counties with populations over 3,000,000. That money supports local criminal justice systems.
The tiered privilege tax on mobile and online sports wagering is not affected either. Rates start at 20% and climb to 40% depending on how much a company earns.
Fantasy Contests Face Bigger Changes
The larger part of the bill focuses on fantasy contests. Current law lays out a full framework for how these contests operate in Illinois.
That framework says fantasy contests are not considered gambling. It also sets up licensing rules and a privilege tax for operators who run these contests.
Weaver’s bill would repeal all of these sections. This would remove both the licensing system and the tax tied to it.
The bill also changes the Criminal Code of 2012. It strips out language that protects fantasy contest players from being convicted of gambling.
This is Weaver’s second bill this month dealing with gambling-related taxes. In early September, he filed a separate bill targeting a new tax on prediction market trades.
That earlier tax became law in June and took effect in July. It applies a 1.75% charge to trades made on prediction markets tied to sporting events, rising to 3.5% for high-volume licensees.
Kalshi, a prediction market platform, is currently in a legal fight with Illinois over that tax. The company argues the law forces it to get costly state licenses and limits trading to Illinois residents.
Kalshi says this conflicts with federal rules that require nationwide, equal access to its markets. That legal case is separate from Weaver’s new bill but connected to the same policy debate.
Weaver’s second bill would remove all references to the prediction market tax from the Sports Wagering Act. Both bills are still moving through the legislative process.
