Illinois lawmaker files bill to repeal prediction-market tax

What House Bill 5814 would change

Rep. Travis Weaver, a Pekin Republican, has filed House Bill 5814 to repeal Illinois’ tax on “exchange wagers,” the category that covers trades made through prediction markets. The tax was included in the state budget signed in June.

Under that budget provision, exchange wagers are taxed at a rate of 1.75% for the first 5 million trades placed in Illinois. The rate rises to 3.5% after the 5 million-trade threshold. Weaver’s measure would remove that tax.

The bill also would establish in state law that fantasy contests are not gambling. That provision would formally place fantasy contests outside Illinois’ sports-betting tax structure.

How the tax fits into Illinois betting policy

Illinois has separately charged traditional sportsbooks a per-bet tax since 2025. That system charges 25 cents for each of the first 20 million wagers and 50 cents per wager after that threshold. House Bill 5814 targets the percentage tax on exchange wagers, not those charges on traditional sportsbook bets.

Prediction markets operate under federal law, while states have taken different approaches to their treatment. Illinois used its budget to apply a state tax to prediction-market trades.

What happens next

Weaver wants lawmakers to consider the bill during the veto session, which begins Nov. 17. The measure would need approval from both chambers of the Illinois General Assembly before going to Gov. JB Pritzker.

Illinois lawmakers previously considered House Bill 5143, introduced by Rep. Daniel Didech in 2025. That measure would have ended the traditional sportsbook per-bet tax on July 1, 2026, but it did not advance from committee in March 2026.