Rush Street Interactive

• Rush Street Interactive has pledged it will not institute a tax surcharge on winning sports bets
• The announcement comes three days after DraftKings announced a new tax surcharge on winning bets across four states beginning 2025
• All eyes turn to ESPN BET and FanDuel to see if a similar plan will be implemented

Rush Street Interactive to its sports betting customers…read our lips, no new tax surcharges.

BetRivers became the first operator to publicly declare it will not be implementing a tax surcharge on winning sports bets, just four days after DraftKings revealed its new plan to do so across four states in 2025.

But with two sports betting companies Q2 reports looming large this month, will anyone else publicly oppose the plan or announce intentions to implement one of their own?

First Operator to Call out DraftKings

The sports betting giant last week announced it would be implementing a “gaming tax surcharge” on winning bets in New York, Illinois, Vermont, and Pennsylvania, as a tool to keep it its tax rates around 20% in the jurisdictions.

The surcharge will be implemented in “high tax  online sports betting states that have multiple operators (Illinois, New York, Pennsylvania, and Vermont) to ensure an operational effective tax rate of approximately 20%,” according to the company’s Q2 earnings report.

Rush Street Interactive, with its BetRivers brand, announced today it has no plans of instituting such a strategy. BetRivers is live in New York, Pennsylvania, and Illinois, three of the four states DraftKings will introduce its new tax surcharge.

“As we put our customers first, it was an easy decision for us,” Richard Schwartz, CEO of RSI, said in the release.

Rush Street Interactive became the first gaming company to publicly call out the new DraftKings plan. However, several others may have also tipped their hands when it comes to instituting a tax surcharge of their own.

Neither BetMGM or Caesars mentioned plans during their recent earnings calls for a tax surcharge. Does this mean they have no plans to do so? Not necessarily, but if such a plan was being considered it likely would be been discussed during the reports.

All Eyes on FanDuel, ESPN BET

So with Rush Street Interactive publicly opposing the plan, sports betting customers now turn their attention to two major players in the industry to see if they have any tax surcharge propositions of their own.

FanDuel, which has roughly a similar U.S. market share as DraftKings of 33%, will host its Q2 earnings report on Tuesday, Aug. 13. If it has any plans for a tax surcharge of its own on winning bets, it will likely be introduced to the public during the earnings report.

PENN Entertainment, which has partnered with ESPN to offer ESPN BET throughout the U.S.,  will also host a Q2 earnings report on Thursday, Aug. 8.

It will be interesting to see if either of these operators intend to mirror DraftKings, or deviate from the operator’s plan. Will they view this as an opportunity to capture a portion of DraftKings’ customer base that will be fed up with paying tax surcharges, or will they join forces with the operator and institute new fees of their own?

We’ll have our answers soon enough.

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