LOUISVILLE, Ky. – Illinois will “at some point” legalize real money online casino gaming, the state’s attorney general predicted Thursday.
- Illinois Attorney General Kwame Raoul predicts the state will eventually legalize online casino gaming, viewing it as the next step in Illinois’ ongoing gambling expansion.
- Despite no expected action in 2025, legalization could be considered in 2026, with iGaming seen as a potential major new revenue source in a state facing chronic budget deficits.
- Opposition stems largely from concerns over impacts to brick-and-mortar casinos, but strong projected revenues and recent increases in sports betting taxes may encourage industry support for online casino legalization.
Illinois is set to legalize iGaming as part of its continued gaming expansions of recent years, Attorney General Kwame Raoul said Thursday. Speaking at a meeting of the National Council of Legislators from Gaming States, Raoul predicted iCasinos would be among the next wave of expansion in a state that already is one of the nation’s largest gaming markets.
Raoul served nearly 15 years in the state legislature before he was elected Attorney General in 2018. Though he can no longer vote on legislation directly in his current role, Raoul indicated Thursday that he was bullish on potential iGaming expansion.
The attorney general gave no timeline projection on passing iGaming legalization legislation. State lawmakers are unlikely to consider any such legislation in 2025 but could take up a bill when the 2026 legislative session begins in January of next year.
Illinois gaming background
In the past three decades Illinois has become one of America’s most expansive gaming markets.
The state has land-based and riverboat casinos, a state lottery, legal mobile sportsbooks and thousands of video lottery terminal video gaming machine locations. These entities generated roughly $1.7 billion in tax dollars in 2024, a figure set to increase in 2025, Raoul said.
The state has increasingly turned to gambling as it perennially faces one of the country’s most significant budget deficits. Online casino gaming, advocates argue, would be another revenue stream.
After launching mobile sportsbooks in 2020, lawmakers have considered Illinois online casino gaming legalization. Digital slots and table games generate significantly more operator and tax revenue than mobile sportsbooks in states with both these offerings.
Politically, these games have been far more controversial in Illinois and nationwide. Thirty-nine states have approved sports betting in some form while only seven have legal iCasinos.
In Illinois, political opposition isn’t centered on religious or societal worries but on the impact on existing brick-and-mortar gaming. Though studies have shown varied impacts of online gaming on in-person revenues, concerns remain from many land-based casino operators that online casino gaming will hurt existing operators’ bottom lines and cost some employees their jobs.
Illinois is the second-highest grossing sports betting market, behind only New York. It would likely be the country’s highest-grossing iGaming market if legalized, potentially generating tens of billions of dollars in annual bets and hundreds of millions of dollars in operator revenue and taxes.
Sports betting tax increases
Discussions around Illinois iGaming comes as the state has passed significant tax increases in each of the past two years.
Illinois created a tiered tax system in 2024 that raised taxes at certain revenue thresholds. Earlier this year, policymakers passed a tax on each individual bet placed with that number also increasing at different levels.
ILL Tax Bill on Sports Bets: FIRE EVERYONE who wrote it.
— Steve Fezzik (@FezzikSports) June 3, 2025
States currently pay a .25% Federal Sports Betting Tax (the Sports Books pay it).
Illinois is going to charge an additional State Tax of .25 per bet, increasing to .50 per bet after 20mm bets are made in State.
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These taxes most directly affect FanDuel and DraftKings, the state’s two revenue and handle leaders, which combined accept roughly three-fourths of all legal bets placed in the state. Each book announced they would pass on the tax to bettors, which has also been matched by Fanatics.
The operators, not surprisingly, have opposed the tax limits on sports betting, but aside from the new fees on bettors have made no other significant moves or plans to leave the state. Legal online slots and table games, with their significantly higher margins, could make these levies far more palatable for gaming industry stakeholders.
