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Summary:
- Senators Cortez Masto and Cindy Hyde-Smith introduced the Withdrawing Arduous Gaming Excise Rates Act.
- The bipartisan bill would remove sports betting taxes, giving the industry an important tax relief.
- The Act is expected to generate more jobs while cracking down on illegal activities.
Nevada Senator Catherine Cortez Masto (D-Nev.) and Mississippi Senator Cindy Hyde-Smith (R-Miss.) have introduced the Withdrawing Arduous Gaming Excise Rates (WAGER) Act.
The bipartisan bill would remove federal taxes on sports betting taxes, attracting a series of benefits for the sports betting industry, consumers included, as well as the Silver and Magnolia States.
The “Essential Tax Relief” to Create More Jobs and Crack Down on Illegal Gambling
Senator Cortez Masto spoke about Nevada’s “multiple championship-level sports teams”, emphasizing that “responsible, legal sports betting” has the potential to be an excellent revenue source for the local economy.
In the same statement, the Senator argued that the proposed bipartisan legislation, which would eliminate handle and head taxes from legal sports betting, would offer “essential tax relief” to both consumers and the sports gaming industry in itself while generating more job openings, preserving tax money in the state, and fighting off illegal activities.
The Seven-Decade-Old “Antiquated” Tax Must Go
The current Internal Revenue Code (IRC) which applies a federal excise “handle” tax of 0.25% on all legal sports bets and a $50 annual “head” tax per employee for legal sports betting operators was established in 1951.
The intention of the IRC was to “prosecute illegal sports betting operators”, as explained by the American Gaming Association’s chief executive officer, Bill Miller.
According to officials from Senator Cortez Masto’s office, in 2022, the state paid close to $22 million in handle taxes.
Compared to 2019, the figure represented nearly double of Nevada’s total.
Miller called the tax “antiquated” in the context of today’s 38 states and Washington D.C. where sports betting is legal, giving operators a competitive disadvantage and rewarding illegal offshore bookmakers that do not pay state and federal taxes.
The CEO further added the seven-decade-old tax does not offer any responsible gaming tools while also lacking systems that would prevent underage players from using legal platforms.
According to officials from Senator Cortez Masto’s office, the WAGER Act would exempt legal sports betting from the harmful tax while aiding laws in their endeavor to crack down on illegal gambling.
Currently, Nevada allows sports wagers anytime and anywhere within the state, due to its highly robust gambling market.
