Illinois should soon receive a boost from a tax increase included in the state’s budget for its video gambling market. Illinois is already a leader in mobile gaming as one of only a few states with online lotteries.
In the latest state budget proposal, the Illinois House included plans to raise the state’s tax on video gaming terminals (VGTs) to 35% (up from 34%), which could produce an estimated $35 million increase in funds for the state.
VGTs are quite different from other lottery options, such as lottery draw games. They feature gameplay similar to a slot machine, although the outcomes are determined in the same manner as the other lottery games.
According to statistics provided by the Illinois Gaming Board, VGTs reportedly provided more than $980 million in tax revenue in 2023, with over $836 million directed to the state and upward of $144 million provided to local municipalities.
More access to VGTs could deliver even larger revenues in Illinois
While the 1% increase will provide additional funding in the state, an even bigger tax boon would arrive with a broader deployment of VGTs.
Illinois legalized these gaming machines for businesses holding liquor licenses in 2012. But, Chicago’s City Council has maintained a ban on video game terminals that’s prevented them from being utilized in the state’s largest city.
However, across the state, more than 45,000 VGTs are in operation, with Springfield leading the way. It has approximately 140 businesses in the city offering the machines, helping create this lucrative market.
Evanston City Council rejects VGT expansion proposal
Some officials in Illinois would like to expand the use of VGTs even further, with the belief that Chicago and other areas could deliver an even bigger windfall in terms of tax revenue.
However, in Evanston, a suburb of Chicago, the city council recently voted 5-2 to reject a proposal that would have allowed nine businesses to each have up to three video gaming machines.
Devon Reid, an alderperson on the Evanston City Council and one of the measure’s proponents, was dismayed by the vote:
“I think this is an opportunity for us to accept that this is what folks are going to do, to regulate it in a way that makes sense for our businesses, for the city. Folks are going to engage in this video gaming on their phones or from their desktops or, you know, out in other communities regardless and this doesn’t add to it. I think this creates just an avenue for folks to do it in a more social setting.”
Photo by Dogora Sun via Shutterstock
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