Politicians from Nevada and Pennsylvania are back for another crack at ending the federal sports betting tax.
PA Rep. Guy Reschenthaler and his Congressional Gaming Caucus co-chair Dina Titus said Thursday they filed a new bill on the issue.
The legislation aims to repeal the 0.25% excise tax on all legal sports bets, known as the “handle tax.” It would also end the $50 per head annual fee sports betting operators pay for employees that can accept wagers.
Why the time is right to end the handle tax
Titus said the tax is making it harder for sportsbooks to recover from the coronavirus pandemic.
“The handle tax punishes legal gaming operators and encourages consumers to place bets illegally,” Titus said. “As more states recognize the benefits of legalizing and regulating sports betting, repealing the handle tax will create jobs in Southern Nevada and across the country.”
Of course, the political landscape has changed since the previous efforts with Democrats now controlling Congress and the White House.
Handle tax favors black market
Reschenthaler echoed Titus in saying the tax favored offshore operators.
He said: “The [sports betting] industry is hindered by an outdated tax code and burdensome regulations that penalize legal, regulated operators while giving illegal operations an unfair advantage.”
The American Gaming Association (AGA) estimated the federal excise tax brought in less than $33 million for the US government in 2019. Titus previously tried to track down where those funds went in 2014 but couldn’t find an answer.
She said Nevada alone paid more than $13.3 million in handle tax in 2019.
The AGA also issued a statement in support of the bill. AGA president Bill Miller said the tax was originally designed to punish illegal betting operators, but now did the reverse.
“If Congress wants to position the legal sports betting market for success,” Miller said. “It needs to eradicate this unnecessarily burdensome tax to level the playing field for legal sportsbooks.”