Illinois Gambling Tax Revenues Surpass $2 Billion in FY24, With Casinos Lagging Behind
Tax Revenue Reaches Record High
The Illinois gambling industry generated a record $2.08 billion in tax revenue during the 2024 fiscal year (FY24), according to the annual Wagering in Illinois report released by the Commission on Government Forecasting and Accountability. This marks a 4.8% increase from the $1.99 billion recorded in FY23.
Major Contributors: Video Gaming, Lottery, and Sports Betting
The report attributes this growth primarily to the continued expansion of video gaming terminals (VGTs), strong lottery ticket sales, and rapidly growing sports betting revenue. Lottery and video gaming dominated tax contributions with $886 million and $848 million, respectively. Sports betting brought in $190 million in taxes and licensing fees, while horse racing generated $6 million.
Casinos, however, contributed just $158 million in tax revenue, slightly up from $157 million in FY23. Despite the opening of two new casinos, their fiscal impact remains limited due to factors such as reduced tax rates and high administrative costs.
Video Gaming Outpaces Casinos
Since their legalization in 2009, video gaming terminals have seen exponential growth. The number of operational terminals increased from 61 in 2012 to 48,176 in June 2024. Tax revenue from VGTs soared from $145.6 million in FY14 to $997 million in FY24. With the tax on VGT net income set to rise from 34% to 35% in FY25, the sector is expected to maintain its dominant position.
This growth has posed challenges for casinos, which have struggled to compete with the convenience and accessibility of video gaming parlors, especially during the COVID-19 pandemic.
Challenges and Future Prospects for Casinos
Although casinos reported $1.61 billion in adjusted gross revenue in FY24—their highest total since FY12—most establishments face stagnant or declining earnings. Over the past decade, 10 of Illinois’ 15 casinos have experienced revenue declines of at least 18%.
The planned opening of a casino in Chicago in 2026 may boost the sector but could also intensify competition and cannibalize revenue from existing establishments.
Sports Betting Continues to Expand
For the first time, adjusted gross revenue from sports betting surpassed $1 billion in FY24, with tax collections reaching $166 million, up 16% from FY23. However, a progressive tax structure set to take effect in FY25—ranging from 20% to 40%—could influence operators’ advertising and business strategies.
Despite these upcoming changes, analysts remain optimistic about the sector’s growth, driven by the rise of online betting and increased investment in marketing.
