Congressional Bill to Eliminate Federal Handle Tax on Sports Betting Introduced

A new federal sports betting bill – HR7790 – has been introduced before the US Congress with a purpose to repeal the 0.25% tax collected from legal operators. US Representatives and congressional Gaming Caucus co-chairs, Dina Titus (D.-Nev.), and Guy Reschenthaler (R-Pa.), who are pushing for this bill to be ed, are also trying to eliminate a $50 employee tax.

Active since 1951, this excise was originally designed to curb illegal bookmaking and was set to be used for federal law enforcement to infiltrate underground gambling rings. In the last year, the US Government was able to raise $13.1 million from Nevada only but, as representative Titus of Nevada’s first district said, the Internal Revenue Service (IRS) “couldn’t answer how the money was being used.”

In her opinion, this tax is hurting not helping legal operators and now, with the return of sports, it’s a perfect time to discuss how effective it actually is.

“Sports are back,” Titus said. “Unfortunately, the penalty on making legal sports bets never left. The handle tax makes it more difficult for legal gaming establishments to compete with illegal operators.”

“Repealing it will push more consumers out of the black market and into a well-regulated market. Forcing sportsbooks to pay a per-employee tax is the last thing we need when gaming establishments are still making announcements about new rounds of layoffs and furloughs.”

Bill Miller, the president and chief executive of the American Gaming Association (AGA), s Titus’ initiative. The last AGA survey shows that more than half of players who wagered in 2019 with illegal operators actually believed they bet legally.

” The federal excise and head taxes levied on legal US sportsbooks generate little meaningful revenue for the government,” Miller said. “Instead, they place legitimate businesses at a significant competitive disadvantage against illicit gambling operations which skirt taxes and licensing fees. Though originally enacted in the 1950s as a tool to curb illegal gambling, these antiquated federal taxes now give illegal operators a leg up.”

Ending Counterproductive Practice

The Representative of Pennsylvania’s 14th district Reschenthaler believes this will protect jobs at a time when many are at threat. Let’s not forget, just last week, two Las Vegas casinos, Circus Circus and Tropicana, announced they will be making combined layoffs of 872 employees between now and October.

“I’m proud to my Gaming Caucus co-chair Representative Dina Titus to introduce this important legislation that will eliminate an outdated tax and burdensome requirements on the gaming industry,” Reschenthaler said.

“At a time when so many employees in the industry are struggling, this bill ends the counterproductive practice of penalizing employers for creating jobs by eliminating a per-employee tax. Gaming is a vital economic driver in Pennsylvania, ing over 33,000 jobs, and this legislation will help pave the way for economic growth and job creation in my district and throughout the nation.”

Source:

“Congressional Bill Aims to Scrap 0.25% Federal Handle Tax”, igbnorthamerica.com, July 27, 2020.