DraftKings (NASDAQ: DKNG), which expressed dissatisfaction at Illinois' tax rate tripling in the last two years, announced Thursday that it will impose a 50 cent extra on all online sports wagers made in the state starting on September 1.

The Boston-based business made the statement two days after FanDuel's parent company, competitor Flutter Entertainment (NYSE: FLUT), announced it will impose a 50 cent fee per wager in response to the most recent increase in Illinois' sports betting tax.  Jason Robins, the CEO and co-founder of DraftKings, was blunt about the state's tax gambits on sports betting.

"We are disappointed that Illinois policymakers have chosen to more than triple our tax rate over the past two years, and we are very concerned about what this will do to the legal, regulated industry,” he said in a statement. “Meanwhile, Illinois continues to fuel the rapidly growing illegal industry, which pays no taxes or fees and provides none of the consumer protections that regulated operators offer.”

Illinois imposed a new sports betting tax earlier this month. Under the tax, operators will pay 25 cents per wager on the first 20 million bets they book. After the 20 million mark is reached, the fee will double to 50 cents per wager.

FanDuel and DraftKings  Illinois Access Comes with a Cost

Despite being the sixth most populous state in terms of population, Illinois has the third largest internet sports wagering market in the United States due to the prohibitions on online sports betting in California and Texas, as well as the Seminole Tribe's monopoly on the activity in Florida.

Put another way, businesses like DraftKings and FanDuel must function there, although they are the ones who are most negatively impacted by the state's sports betting tax laws.  Barry Jonas, an analyst at Truisit Securities, calculated in a note released earlier this month that DraftKings and FanDuel would have paid an extra $68 million and $77 million, respectively, if the new tax had been in place for the previous 12 months.

The new tax follows Illinois's July implementation of a graduated sports wagering tax system, which imposes more taxes on the biggest operators—DraftKings and FanDuel—than on their smaller rivals.

Although Robins admitted that Illinois has played a significant role in the expansion of his business, some observers believe that the state's new per-bet fee, which is levied on operators, may reduce the profits of certain gaming companies operating there.  Among them are FanDuel and DraftKings.

Surcharge Optics Don't Work Well

Bettors don't appreciate the idea of the operators' tax duties being passed on to them, as evidenced by the mockery FanDuel has received on social media and in sports betting communities in the days since it announced its Illinois levy.

DraftKings probably knows that a similar fate is in store for it because, in August of last year, the business revealed plans to add transaction fees in Illinois, New York, Pennsylvania, and Vermont. However, no competitors agreed, thus the proposal was eventually canceled.  DraftKings stated that it would be willing to collaborate with Illinois on positive policy ideas.

“DraftKings continues to support collaborative policymaking that works for the state and allows for the long-term sustainability of the industry,” according to the press release. “Should the legislation be repealed, the company will immediately remove the Illinois-specific per wager transaction fee.”