Washington – A bill that would legalize some forms of online
gambling in the U.S. has passed a vote in the U.S. House Committee on Financial
Services. Introduced by Rep. Barney Frank (D-Mass.), chair of the committee,
the Internet Gambling Regulation and Consumer Protection and Enforcement Act
was approved by a 41-22 vote in the committee.
The bill would regulate online
gambling in the U.S. and require licensed operators to install safeguards
against underage and problem gambling.
Proponents cite a Joint Committee on
Taxation tax revenue analysis that showed regulated Internet gambling could
generate as much as $42 billion in federal government revenue over its first 10
years.
"The Committee’s bi-partisan vote to approve Chairman Frank’s
legislation is nothing short of historic," said Michael Waxman,
spokesperson for the Safe and Secure Internet Gambling Initiative, a group
lobbying in favor of the bill.
"With Congress bitterly divided and only a handful of bi-partisan
bills coming out of the Financial Services Committee, we’re pleased Committee
members from both sides of the aisle were able to come together to advance this
important legislation."
A companion bill to Rep. Frank’s proposed
legislation, the Internet Gambling Regulation and Tax Enforcement Act — introduced
by Rep. Jim McDermott (D-Wash.) in March — would ensure the collection of
license fees and taxes on regulated Internet gambling activities.
Related Links:
http://www.safeandsecureig.org
So, how will that work? Financial institutions will again be allowed to process payments. How will profit for taxes be computed? Suppose a person plays a casino game and takes some steady losses. Then through luck and/or skill, the online gambler has a good session or two, exceeding his losses by a small amount. Would taxes be computed on each separate gambling session or totaled over all sessions played during a certain period of time? In other words, would the tax be tallied depending the amount of money won over and above, say, an initial deposit or starting point? Would the total losses be allowed to be deducted from the total gains over several sessions, deducted on the spot when cashed in, (win or loss)or, would it simply be computed like this: Session 1 = $100.00 loss. session 2 = $200 loss and session 3 = $301.00 win –all reported at the end of the taxable year? Would the gambler pay no taxes for the first two sessions that lost $300.00, but pay, say 25% of the $301.00 win on the last session, whereby the gambler would owe $75.25 for the overall $1.00 won over all three sessions over a taxable year? This way, it would be a money tree for the IRS, theoretically resulting in high tax rates on the gambler, even though, overall, during the taxable period, he had suffered hugh losses. I just can’t see the IRS taxing on the gambler’s itemized reported losses and gains, versus a quick immediate tax on any monies won in any gambling session. I know that gambling proceeds have always been taxed immediately on slot machines and keno winnings and the like, regardless of how many dollars were spent achieving that win. I just think that is the way the IRS would handle it on casino games like Craps, Baccarat and Roulette — a simple reckong at the end of each session. Except in games of skill, such as poker, it is practically impossible to win over time, everyone knows that. How much more difficult lt would be to come out ahead if, over time, losses are not counted, but treated the way slots winnings are treated in land based casinos. Where am I going wrong on this? Looks like this would be a hard row to plow for the individual gambler and a golden goose for the government.
That 1.3%- 1.4% (Baccarat & Craps) house vig would effectively be turned into a monster vig, multiples higher than even a 16.67% vig on the seven in craps–though in this case it would not go to the house, but to the IRS. If this turns out to be the way taxes are computred, we were far better off just letting other entities process the accounts, (since in 2006 it was made unlawful for visa and other banking institutions to process an account) when there were lawful, but clumsey and time consuming ways of handling accounts.
I think the US government should legalize online gambling, when in th UK you can gamble online for all sorts of things!!!
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