Illinois Will Have Plenty Of Sports Betting Competition From Neighboring States

Illinois has a issue— a three-state problem, to be precise.

The states neighboring the Prairie State – Indiana, Iowa, and Missouri – pose a significant challenge as the state approaches the launch of retail sports betting. Currently, 27 wholesale casinos are in operation in Iowa and Indiana. Furthermore, this week saw two Missouri lawmakers propose bills to legalize sports betting.

Iowa and Indiana, with their advanced sportsbook industries, represent the highest risks due to their attractiveness to Illinois bettors. Meanwhile, the ongoing discussions among Missouri lawmakers over two sports betting bills clearly indicate Missouri’s keen interest in sports betting as well.

 

Missouri: The newcomer

Missouri’s state legislature is currently advancing two distinct sports betting bills through its committees.

On Wednesday, a House committee passed a bill proposed by Rep. Cody Smith. The bill advocates for retail, online, and mobile sports betting.

In simpler terms, the most disputed section requires operators to use standard league data when setting prop bets. This could mean that professional sports leagues may charge for access to their data. This is known as an “integrity fee.”

The second bill, backed by Rep. Phil Christofanelli, permits retail, mobile, and online betting, but it does not include an official data requirement.

The Special Committee on Government Oversight has given approval for both costs. However, before reaching the voting stage in the House and Senate, there are still more hurdles to clear.

 

Iowa: The wagering spear’s tip

The 13 sportsbooks owned by Iowa and the state itself are profiting from sports wager taxes while Illinois navigates through government bureaucracy.

It’s likely not overlooked by Illinois regulators that Iowa inaugurated its first fiscal casino in August 2019, a mere three months subsequent to legalizing sports betting in May 2019. The swiftness of this action allowed Iowa to become the first in the Midwest to enter the market.

 

Indiana: Moving forward

Indiana legalized both online and physical sports gambling in May 2019, and launched its first casino in September of the same year.

Due to the fall launch of the state, Illinois found itself sandwiched between two new sports betting markets – one in Iowa to the west and another in Indiana.

You are required to open an online sports betting account in person at a casino in Iowa, a feature that sets it apart from other markets. Unlike Iowa, Indiana does not have similar laws in place.

 

Where does Illinois stand in relation to the opposition?

In Illinois, the panorama of sports wagering options showcases both the best and worst due to competition. The suggested integrity fee in Missouri, along with Iowa’s requirement for in-person betting, are seen as drawbacks. However, the expansion of gaming casinos has proven to be advantageous for Iowa and Indiana.

Regardless of the situation, it is certain that casinos in Iowa and Indiana jointly generate over $60 million in revenue this year. Now, Illinois is preparing to become operational.

Casinos in Iowa have so far paid over $1.3 million in taxes, whereas those in Indiana have paid over $4.06 million.

Besides offering sports betting systems, Illinois is missing out on substantial profits that could be generated from the 15% tax rate and calculated on the revenue from sports bets. Although the state benefits from this tax rate, it faces three significant drawbacks due to existing laws:

There is a great tax rate.
• To create an online account, gamblers need to sign up at gaming properties.
• Casinos could potentially pay up to $10 million for a sports betting license.

These three limitations are dreadful in their own right. Nevertheless, Illinois must combat the menace of contrast.

The tax rate in Indiana is 9.5%, compared to 6.7% in Iowa. Meanwhile, one of the proposed sports betting costs from Missouri requires a 9% tax rate.

Next, legislators in Illinois decided to implement a physical sign-up requirement for online gaming. Under the new law, this provision will be in place for a minimum of 18 weeks.

Ultimately, both Indiana and Iowa chose to maintain sports betting licenses under $100,000.

In conclusion, casinos and sports betting operators are prepared to bear the cost of operation. More often than not, sports betting is a profitable venture on an annual basis. This savvy business decision is why seven casinos currently hold the provisional license required to open a sportsbook.