DraftKings backtracks, decides not to add surcharge to winning wagers
Upon further review, DraftKings sportsbook has decided to abandon its plan to add a surcharge to winning wagers in states with high sports betting tax rates.
“We always listen to our customers and after hearing their feedback we have decided not to move forward with the gaming tax surcharge,” the company said in a statement Tuesday. “We are always committed to delivering the best value in the industry to our loyal customers.”
DraftKings Statement on Gaming Tax Surcharge pic.twitter.com/cucbsQJIVD
— DraftKings News (@DraftKingsNews) August 13, 2024
DraftKings CEO Jason Robins announced Aug. 1 that, starting next year, the sportsbook giant, which doesn’t operate in Nevada, would deduct a 3.2 percent gaming tax surcharge from winning wagers in Illinois, which recently raised taxes on sports betting from 15 percent to 40 percent.
That meant a bettor who placed a traditional straight bet of $11 to win $10 would make only $9.68 under the plan, which was widely panned by bettors and bookmakers alike.
Bettors must win 52.4 percent of their wagers to turn a profit against a -110 price. With an additional 3.2 percent surcharge, which equates to -114, gamblers would have to win 53.3 percent of their wagers to make a profit.
DraftKings initially planned to add surcharges in states with rates over 20 percent, which currently includes Illinois, Pennsylvania, Vermont and New York, which is at 51 percent. Nevada’s tax rate is 6.75 percent.
Contact reporter Todd Dewey at tdewey@reviewjournal.com. Follow @tdewey33 on X.