Posted on: April 1, 2021, 11:47 am.
Last update on: April 1, 2021, 11:47 am.
Steve Bittenbender
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The chairmen of the non-partisan Congressional Gaming Caucus tabled a bill on Thursday that was certainly not an April Fool’s joke. The US representatives Dina Titus (D-Nevada) and Guy Reschenthaler (R-Pennsylvania) want Uncle Sam’s hand to be excluded from legal sports betting.
Bettors places bets on Horseshoe Southern Indiana Sports Betting opening in September 2019. Two representatives of Congress are trying to end a federal tax on both bets placed on legal sports betting and a per-employee fee for these facilities. (Image: Casino.org)
With their bill, which they also submitted last year, the “Handle Tax” is to be removed from legal sports betting. With the exception of bets on horse racing and certain sports betting, which are run by state lotteries, a 0.25 percent levy is levied on each bet. The legislature introduced the tax 70 years ago.
In a statement Thursday, Titus said Nevada’s sports betting generated $ 13.3 million in tax revenue.
In recent years, only Nevada sports betting has paid this levy. Sports betting has exploded across the country since the Supreme Court overturned PASPA nearly three years ago. By the end of the 2020 calendar year, sports betting was legal in 19 states and the District of Columbia.
“I’ve proposed this legislation for years and I finally feel the momentum is on our side,” said Titus. “I look forward to continuing to work with Congressman Reschenthaler to bring this bill into law.”
AGA: Handle taxes that no longer serve the purpose
The “Handle Tax” has also been a goal of the American Gaming Association for years. The industry group says the fee that illegal bookmakers and offshore sports betting do not pay makes this option more attractive to bettors.
In his statement, AGA President and CEO Bill Miller noted the irony behind the wheel.
While the original purpose of the federal excise tax was to punish illegal operators, this outdated tax is now helping the offshore market, the illegal market and the disadvantages of safe, legal and regulated sports betting across the country, ”he said. “If Congress wants to position the legal sports betting market for success, it must remove this unnecessarily burdensome tax in order to improve the playing field for legal sports betting.”
According to the American Gaming Association, 17 states and the District of Columbia reported a combined sports betting handle of nearly $ 21.5 billion in calendar year 2020. This number is based on commercial handles, excluding New Mexico, where sports betting is only on tribal land. New York is also not included. This state does not report the grip on sports betting, which is located in its four commercially licensed casinos.
Based on this reporting, the tax would be approximately $ 53.7 million. The number would change once federal officials add up New York’s tax revenue and place all lottery-generated bets.
Feds also levy taxes on every sports betting worker
In addition to taxing the stake itself, federal law forces sports betting to pay a fee of $ 50 per employee.
Both Titus and Reschenthaler said the tax threatens jobs at a time when the country is trying to save jobs that have been lost to the COVID-19 pandemic.
According to Titus, Las Vegas currently has the second highest unemployment rate of any major metropolitan area.
“Unfortunately, the industry is hampered by an outdated tax law and burdensome regulations that punish legal, regulated operators and give illegal operations an unfair advantage,” said Reschenthaler.