Debate on Online Gambling in US

According to “independent.co.uk” United States are discussing the possibility to lift the restrictions of internet gambling. It is the first time since the Unlawful Internet Gambling Enforcement Act of 2006 passed that there is serious debate regarding this issue. The above mentioned law passed in an effort of the US government to minimize money laundry from the Web as they were not able to track down the true receivers of the wagers placed by online poker, online bingo or casino players. Back then, many opinions expressed in favor of the online banning act, including that the money from the US residents was used to fund terrorist attacks within US soil.

Almost four years passed since the law enforcement and now distinct members of the political world started a debate on Senate’s Ways and Means Committee as an effort to reverse the 2006 ban. Congressmen Barney Frank and Jim McDermott are leading the campaign which is based on three main points.

For permitting online gambling, the federal government and the states can receive over $42 billion by taxation within a 10 years period. The companies will have to pay 2% tax to the federal government and 6% to the state that issued the gambling license. Additionally, taxes will be applied to the players’ winnings who; as Jim McDermott stated: “We are sending a multi-billion dollar industry offshore and underground. As a result, we are making tax criminals of Americans who can’t declare their online winnings to the IRS”.

The committee meeting will be considering H.R. 4976, a bill that would tax online gambling in the United States, if a companion bill that legalizes online gambling were to pass. The bill is sponsored by Congressman Jim McDermott (D-Wash.), and would create a revenue stream for the U.S. government that currently does not exist. Revenue would go to the federal government, states and tribal governments. Some of the funds generated would also be earmarked to help foster-care systems.

The Committee will discuss the current tax laws and reporting requirements applicable to wagering in the United States. The Committee will consider tax and other proposals in the Committee’s jurisdiction related to legislation pending in the Congress to license and regulate Internet gambling activities.

any online gaming companies that were shut out of the US market eye the opportunity of a come back. London based Party Gaming and 888.com, two of the biggest companies in the world in the area of online gambling have already mobilized towards that opportunity. Party Gaming is in negotiations with brick and mortar casino operators in the US about possible joint ventures, should the laws be relaxed at a federal level or by individual states, and 888.com, too, is “staying close” to the American casino chain.