Donald Trump · Decrypt
Kalshi sued Illinois Wednesday, claiming in federal court that the state has no right to levy taxes on prediction markets
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Last week, Illinois governor JB Pritzker signed a bill into law that, in addition to creating a statewide tax on crypto transactions, also established a “Sports Wagering Fund.” The fund, set to launch on July 1, will tax gross receipts from sports-related prediction market wagers at 15%.
Key facts
- Kalshi sued Illinois Wednesday, claiming in federal court that the state has no right to levy taxes on prediction markets
- In taxing such wagers, Illinois asserted that sports-related prediction markets are a form of state-regulated sports betting—and not swaps overseen by the CFTC at the federal level, as industry
- Kalshi’s lawsuit follows the lead of the Trump CFTC, which last week amended an existing lawsuit against Illinois to protest the state’s new tax
- Lawsuits on the subject are ongoing in nearly every federal jurisdiction at this point, and the issue is therefore likely to ultimately be decided by the U.S. Supreme Court
Summary
Kalshi sued Illinois after the state created a 15% tax on revenue from sports-related prediction market wagers. The tax is set to go into effect on July 1. The case marks the latest battle in a nationwide fight between states and the Trump administration over whether prediction markets should be considered gambling. Kalshi sued Illinois Wednesday, claiming in federal court that the state has no right to levy taxes on prediction markets.