US Reps Again Seek End To Federal Sports Betting Tax
It is not the first time ending the federal excise tax on sports betting has been suggested, but two co-sponsors of a new bill certainly hope it is the last.
US Reps. Dina Titus (D-NV) and Guy Reschenthaler (R-PA) again introduced a bill this week that would end the 0.25% tax placed on all legal sports betting handle.
The two are the co-chairs of the Congressional Gaming Caucus, and previously filed this bill together in 2020 and 2021. Titus also sponsored similar legislation in 2014 and 2015, according to her activity record.
How much has sports betting tax collected?
Legal US sports betting operators have paid the feds more than $500 million since the end of PASPA in March 2018, with handle recently eclipsing the $200 billion mark.
That does not include the $50 per sportsbook employee that each operator must pay annually.
Nearly $235 million of that tax was paid in 2022 alone, as handle hit $93.8 billion last year. That was a significant jump over 2021 with the addition of more states including New York, and should grow more in 2023 with the additions of Massachusetts and Ohio.
Where sports betting tax money goes
Surprisingly, that tax money does not go anywhere in particular. Titus told the Las Vegas Review-Journal in 2014 that the IRS did not know where the cash went when she asked.
Now, with significantly more handle tax being paid each year across the country than when she first introduced the bill in 2014, Titus is again seeking to end a tax whose origins predate PASPA.
“With the explosive growth of sports betting across the country, it’s time to finally repeal the handle tax which penalizes legal gaming operators and punishes sportsbooks for creating jobs,” Titus said. “As Co-Chair of the bipartisan Gaming Caucus, I’m pushing this legislation to keep legal gaming markets thriving nationwide and help local economies reap the benefits of this growing industry.”
Funds could be used to boost legal sportsbooks
Reschenthaler hopes to see those excise tax funds used to better compete with offshore operators:
“Unfortunately, outdated tax codes and burdensome regulations penalize legal operators and incentivize illegal activity,” he said. “The Discriminatory Gaming Tax Repeal Act will ensure the gaming industry can support good-paying jobs and promote economic growth in southwestern Pennsylvania and across the nation.”