Illinois Gambling Tax Haul Sets Fresh Record as Video Terminals Surpass Lottery

Illinois pulled in a record $2.7 billion in gambling-related tax revenue during fiscal year 2026, marking a 19.2 percent jump from the previous year and nearly 90 percent higher than the total collected in fiscal year 2019. The figure comes from the state’s annual wagering report and covers casinos, sports wagering, video gambling machines, and the lottery. Video gambling terminals moved ahead of the lottery to become the single largest contributor during the period.

Officials released the full numbers in October 2026, giving a clear snapshot of how each segment performed. Sports wagering showed particularly strong activity in high-risk parlay bets, with more than $875 million lost on those wagers alone. That activity helped push the overall sports betting tax contribution higher while new casino projects and expanded machine placements added further momentum.

Where the Money Came From

The report breaks down revenue by category and shows video gambling machines leading the pack for the first time. These terminals, located in bars, restaurants, and truck stops across the state, generated more tax dollars than the lottery during fiscal year 2026. Lottery sales remained substantial, yet the rapid growth of video terminals pushed them into second place. Casinos and sportsbooks filled out the remaining shares, with each category posting gains compared with fiscal year 2025.

Data from the annual wagering report indicates that sports wagering grew steadily, driven in part by the volume of parlay activity. Bettors lost more than $875 million on those multi-leg wagers, a detail that highlights how certain bet types concentrate revenue for operators and, by extension, tax collections for the state. The report notes that this pattern continued throughout the fiscal year without signs of slowing.

Video Terminals Take the Lead

Video gambling machines overtook the lottery as the top revenue source because placement expanded and daily usage stayed consistent. Locations that already hosted machines added more units while new venues received approvals. The result was a larger installed base that produced higher aggregate tax payments than traditional lottery products.

Those who track the industry point out that video terminals benefit from convenience and frequent play cycles. Players can access them during everyday activities, which spreads participation across more hours of the day than casino visits or lottery drawings typically allow. This structural advantage helped the category surpass the lottery in fiscal year 2026.

Sports Wagering and Parlay Trends

Sports wagering contributed meaningfully to the overall total, and the report singles out parlay bets as a key driver. The $875 million lost on parlays represents concentrated activity that boosts handle and, consequently, tax revenue. Mobile apps and retail sportsbooks both recorded this pattern, with parlay options remaining popular among users throughout the year.

Figures in the annual wagering report show that sports wagering tax receipts rose alongside the broader increase. The category still trails video terminals and the lottery in absolute dollars, yet its percentage growth outpaced some older segments. Observers note that continued legal clarity and additional sports seasons helped maintain steady participation.

Looking Ahead to Expanded Capacity

The state projects additional revenue growth in coming fiscal years because new casinos are scheduled to open and existing operators plan to add more games and machines. Several projects that received approvals in prior years are moving through construction or final licensing steps. Once these facilities begin operations, they are expected to increase both direct casino taxes and related video terminal counts.

Expanded offerings at current locations, including new sports betting windows and additional video terminal placements, are also factored into forward estimates. The annual wagering report references these developments as structural changes that should support continued year-over-year gains in tax collections. Monthly data compiled by the Illinois Gaming Board and Lottery will allow ongoing monitoring of these trends.

Context Within Recent Years

The $2.7 billion total represents a significant increase from fiscal year 2019 levels, when collections sat roughly 90 percent lower. The compound growth reflects both expanded legal gambling options and higher participation rates across existing products. Video terminals, which were still rolling out in 2019, have since become a mature and dominant category.

Each segment contributed to the climb. Casinos benefited from higher attendance and table game volume in some markets, while the lottery maintained steady sales through traditional and instant games. Sports wagering, legalized more recently, added an entirely new revenue stream that continues to scale. The combined effect produced the record figure reported for fiscal year 2026.

Conclusion

The annual wagering report for fiscal year 2026 documents a clear milestone in Illinois gambling tax collections. Video terminals now lead, sports wagering shows concentrated activity in parlays, and new projects promise further expansion. The data provides a baseline for tracking how these sources evolve in subsequent years as capacity grows and player preferences shift.