ESPN Bet, owned by PENN Entertainment, has made adjustments to its minimum betting limit in Illinois, increasing it to $1 from only 10 cents in response to the per-bet taxation in the state. The tax charges sports books 25 to 50 cents for each bet, which has prompted operators to levy a transaction charge.

The floor for online sports wagering in Illinois continues to rise. ESPN Bet, owned by PENN Entertainment, has increased its minimum bet in the state to $1, up from just 10 cents. The change took effect on August 8, according to the sportsbook's house rules, and was confirmed by an ESPN Bet spokesperson. The move aligns the operator with other major sportsbooks that have adjusted their wagering structures to offset Illinois' new per-bet tax.

A tax changing the playing field

The per-bet tax, enacted by Illinois lawmakers and effective since July, requires online sportsbooks to pay 25 cents per wager for their first 20 million bets each year. Beyond that threshold, the rate doubles to 50 cents per bet. While seemingly modest in isolation, the levy can add up quickly in a high-volume market like Illinois, prompting operators to reassess how they handle small wagers.

Several of ESPN Bet's competitors - including FanDuel, DraftKings, and Fanatics - have opted to pass the cost directly to customers through a 'transaction fee' of 25 or 50 cents per bet. Others, such as BetMGM, BetRivers, and Hard Rock Bet, have followed a path similar to ESPN Bet, raising minimum bet requirements instead of imposing fees.

Customer impact and competitive dynamics

These differing strategies have introduced new variables into Illinois' sports betting market. Some bettors may prefer paying a small fee on occasional low-stakes bets, while others could gravitate toward sportsbooks with higher minimums but no added charges. This creates an environment in which operators can differentiate themselves not just through promotions or odds, but also through how they handle regulatory costs.

ESPN Bet's $1 minimum could be particularly appealing to bettors who dislike seeing transaction fees deducted from their potential winnings. For the operator, the change comes ahead of football season - a critical time for acquiring customers and capturing market share.

While the increase in minimum wager might appear significant, industry data suggests it may have little impact on most users. Analytics from bet-tracking app Juice Reel, shared with investment bank Citizens, indicate that in June, the average single wager in the US was $41, while average parlay bets came in at $19. If those figures hold true for Illinois, many players are already wagering far above the new $1 threshold.

Financial stakes for PENN Entertainment

The move also ties into broader financial pressures for ESPN Bet's parent company, PENN Entertainment. PENN's high-profile partnership with ESPN came at a substantial cost, and the company faces scrutiny to deliver profitability in its interactive division.

"As I said on our Q1 call, we are nearing an inflection point with our digital business, and we anticipate each quarter of 2025 delivering a lower loss sequentially throughout the year, and our interactive division to be profitable in the fourth quarter of 2025 and the full year of 2026, and beyond," Chief Executive Officer Jay Snowden said during last week's earnings call. "The significant investments in interactive are undoubtedly behind us."

The Illinois minimum bet change could help PENN avoid alienating customers with new fees while still addressing the cost impact of the tax. With football season around the corner, the timing may also give the brand an edge in what's expected to be a fiercely competitive period.

Lingering questions over fee revenue

One unresolved issue in Illinois' new sports betting landscape is whether revenue from transaction fees - for those operators choosing that route - will be subject to state taxation. The Illinois Gaming Board has indicated that such revenue will be taxable, though some operators have reportedly taken a different view.

As the market adjusts to the per-bet tax, sportsbooks like ESPN Bet will be watching both customer reactions and competitor moves closely. The new wagering rules could be a temporary adjustment - or they might become a lasting feature of Illinois' sports betting environment.