Rush Street Interactive – the parent company of BetRivers Sportsbook – said it has no plans to implement a customer surcharge in Illinois or anywhere else.
The announcement comes after DraftKings announced it would begin charging customers a surcharge on winnings (roughly 3%) in four states, including in Illinois.
Some thought other sportsbooks might follow DraftKings’ move.
BetRivers Illinois will not be one of them.
BetRivers claps back at DraftKings’, touts customer service record
Rush Street dove into sports wagering in 2019 through its BetRivers Sportsbook. It joined the Illinois sports betting market in June 2020, two months before DraftKings Sportsbook Illinois went live.
In the BetRivers announcement, Rush Street CEO Richard Schwarts took a jab at DraftKings proposal of a surcharge on winnings.
“As we put our customers first, it was an easy decision for us.”
According to the press release, the decision reaffirms BetRivers’ “dedication to providing exceptional value to its players.”
“This customer-first approach is exemplified by RSI’s recent accolade of being named the EGR North America Customer Services Operator of the Year for the fifth consecutive year. This prestigious award highlights RSI’s unwavering dedication to customer service excellence and ongoing efforts to exceed player expectations.”
Under the new tax structure, BetRivers’ tax bill doubles in Illinois
Standing firm against DraftKings is a move other operators will now consider as an option in a challenging Illinois sportsbook market.
By all counts, BetRivers had every reason to consider a surcharge. Illinois bumped the tax rate from 15% to 20% as a baseline starting July 1. As operators’ adjusted gaming revenue (AGR) increased throughout the year, they would be subject to a graduated tax rate that breaks down this way:
- 20%: Base tax rate
- 25%: Over $30 million in AGR
- 30%: Over $50 million in AGR
- 35%: Over $100 million in AGR
- 40%: Over $200 million in AGR
For reference, in 2023, BetRivers would have exceeded the 25% tax rate threshold after April. Starting in August 2023, it would have moved to the 30% bracket and stayed there for the rest of the year. The sportsbook would have paid double the old tax rate for five months.
This year would have been a similar story for BetRivers. After April, the company earned enough to be in the 25% bracket. It’s looking like it will hit the 30% threshold soon. BetRivers has an outside chance of surpassing $100 million in AGR, but most likely it will spend nearly half the year at the 30% tax rate.
Despite seeing its taxes double for a major chunk of the year, BetRivers has decided not to pass the tax burden on to its customers.
As the first operator in Illinois to respond to DraftKings’ proposal, BetRivers has provided a counterpoint to DraftKings’ claim that customers won’t be bothered by a small tax on winnings.
