After Marathon Springfield Session, Illinois Lawmakers Look Ahead to What’s Next

Emily Soto | June 2, 2025, 8:01 pm

Illinois lawmakers worked right up to the May 31 deadline to pass a $55.2 billion spending plan for the upcoming fiscal year.

The budget includes ways to fill declining revenue with new taxes on sports betting and nicotine products while increasing spending by nearly 4%.

State Democrats say the plan accounts for an uncertain future, while Republicans say more cuts are needed to address what’s ahead.

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“(Governor Pritzker) specifically made the statement, ‘If you expect to spend money on projects, you better tell me where you’re going to cut,’” state Sen. Don DeWitte (R- West Dundee) said. “That didn’t happen. What happened was a billion dollars worth of tax increases, eight more billion dollars in borrowing.”

The revenue bill creates a tax of 25 cents per wager for a sports betting licensee’s first 20,000 wagers accepted, and 50 cents per wager after that.

Consumers will also see new taxes on tobacco products. The tax rate will rise to 45% from 36%. Vape products and nicotine pouches would also now be included under the tax.

The revenue plan amends state law to tax sales from all businesses that transact in the state, rather than only businesses with a physical presence in Illinois. The plan also eliminates a “safe harbor” exemption for businesses that move money outside the state.

State Sen. Elgie Sims Jr. (D-Chicago) said these changes won’t impact all Illinoisans.

“Those are taxes on folks who make the choices to engage in those activities,” Sims said. “… This speaks directly to the priorities that we, that we outline and we have. We are trying to make sure that particularly those companies that are using these complex accounting schemes to avoid paying tax are making sure that we recover that … so that we can make the investments necessary to make a better quality of life for working families.”

According to state Rep. Will Guzzardi (D-Chicago), taxes like this are intended to fund programs that support residents.

“We know that raising tobacco taxes is a great way to drive use down, especially among young people,” Guzzardi said. “We’re dedicating some of the revenue from that tobacco tax into tobacco cessation, smoking cessation programs targeted at our young people to make sure they’re not using unhealthy products.”

State Rep. Dan Ugaste (R-St. Charles) pushed back, calling it a broad-based tax.

“They’re going to hurt them at a time when they’re struggling,” Ugaste said. “And it may be because they choose to use tobacco or a little bit of their leisure time is spent on sports betting, but the taxes on business, when business gets hit with a tax, they pass through that cost to consumers. That’s all Illinois.”