Can Online Poker Help Fill Illinois’ Budget Gap?

Illinois lawmakers are weighing a familiar question with a new twist: can digital gaming help balance the books? As the state stares down a projected $3.2 billion shortfall for the fiscal year 2026, online poker is gaining attention in Springfield as one potential revenue source. 

Supporters argue that a regulated iGaming market could generate over $1 billion annually in new taxes. Opponents remain cautious, pointing to challenges for existing casinos and concerns from the video gaming terminal industry. As legislative sessions move forward, poker has become a central part of budget talks.

Budget Context: Where Things Stand

Illinois’ current budget proposal outlines more than $55 billion in spending for fiscal year 2025. Education, healthcare, pensions, and public safety remain top priorities. However, with federal pandemic aid no longer available and pension obligations continuing to grow, state leaders are exploring new tools to maintain core services without leaning on large tax increases.

Federal relief temporarily masked structural gaps, but with that safety net gone, recurring revenue becomes essential. Lawmakers have resisted sweeping tax hikes this session, leaving options like iGaming and cannabis expansion under closer review.

What Online Poker Could Offer

Proposals now under consideration in Springfield include legislation that would regulate and tax internet-based poker and other casino-style games. The expectation: generate fresh revenue from a market that already exists online, mostly unregulated. Players from all over the US can enjoy games at the best online poker site using crypto payments (and benefitting from the perks like decentralized random number generation and generous player rewards). However, these sites are licensed overseas, meaning that the state doesn’t benefit from any tax revenue they generate.

Industry research suggests Illinois could see more than $1.3 billion in annual online casino revenue starting in 2025, growing to $1.7 billion by 2028. While poker would make up a smaller portion of that total, shared player networks with other states could enhance participation and prize pools. That growth, in turn, supports additional tax revenue.

Currently, physical casinos in Illinois bring in roughly $140 million per month in adjusted gross receipts. Meanwhile, online gaming in other states has grown steadily. A January 2025 industry report noted a 21% year-over-year increase in iGaming revenue, further fueling interest in digital expansion.

How the Legislation Is Structured

Two key bills, House Bill 3080 and Senate Bill 1963, outline the framework for legal online poker. Both propose a 25% tax rate on adjusted gross revenue. License eligibility is limited to operators with existing physical gaming facilities, allowing up to three online brands (or “skins”) per licensee.

Start-up fees would be set at $250,000 per license, with smaller renewal costs to encourage long-term compliance. Age verification, location tracking, and platform audits are required under the proposed law. Oversight would fall under the Illinois Gaming Board, which would manage licensing and enforce standards for consumer safety.

The bills also give Illinois the ability to join the Multi-State Internet Gaming Agreement. That would link Illinois poker rooms with players in states like New Jersey, Michigan, and Pennsylvania, improving liquidity and tournament options.

A Look at the National Picture

States that launched legal poker and iGaming operations over the past five years have reported steady revenue increases. New Jersey, for example, brought in more than $2.7 billion in online gaming taxes in 2024. The state’s decision to join a multi-state poker compact added scale to its tournaments and attracted more consistent player traffic.

Pennsylvania’s entry into the agreement in early 2025 expanded the shared player pool by millions, contributing to larger tournament fields and higher average stakes. Since joining, officials estimate that more than 150,000 new users entered the legal market.

Illinois could see similar outcomes. By partnering with other states, the potential market impact expands significantly without requiring added infrastructure. Larger player pools drive platform engagement and help stabilize revenue projections.

Industry Considerations

Stakeholders in Illinois’ existing gambling sector continue to monitor developments. Video gaming terminal operators, who currently contribute over $800 million annually in tax revenue, have voiced concern about overlap. Brick-and-mortar casinos, along with labor unions representing their workers, remain focused on protecting existing jobs and funding streams tied to local foot traffic.

Proponents of the online expansion say a well-regulated digital market can operate alongside physical venues without cannibalizing revenue. Experiences in New Jersey and Michigan suggest many online players previously used unregulated platforms and are not regular visitors to physical casinos. Proponents also argue that the addition of digital play encourages new interest in poker overall.

What Happens Next

As discussions continue in the legislature, the path forward will hinge on political consensus and regulatory clarity. The current bills include several consumer protection provisions and enforcement tools modeled on other states’ successes.

If passed, Illinois would become one of the largest states to legalize online poker, offering a sizable boost to the national network. Whether that boost will be enough to significantly reduce the state’s budget gap remains a matter of debate. But for lawmakers looking to balance priorities without cutting services or raising broad-based taxes, digital poker may soon be part of the fiscal solution.

Final Notes

Online poker won’t close the full $3.2 billion shortfall on its own, but it could contribute meaningfully to the state’s bottom line. Lawmakers continue to explore ways to modernize the revenue base while maintaining fairness across industries. If Illinois adopts a model similar to those seen in Pennsylvania or New Jersey, the outcome could provide a fresh stream of predictable, regulated income.

The question now is how quickly Springfield can act and whether Illinois residents and businesses are ready to adapt to a new era of digital gaming.