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Home > News

Rep. McDermott Introduces Internet Gaming Tax Legislation
Companion Bill to Rep. Frank’s Legislation to License and Regulate Online Gaming

May 6, 2009

Rep. Jim McDermott (D-WA) introduced legislation today to tax licensed Internet gambling in the U.S.  McDermott’s bill, HR 2268, The Internet Gambling Regulation and Tax Enforcement Act of 2009, is the companion to legislation also introduced today by Rep. Barney Frank that would license and regulate online gambling. 

“We are losing billions of dollars in federal and state taxes every year because a prior Administration and its supporters drove legitimate U.S. online gambling off-shore by passing an ill-conceived late-night amendment in Congress that has done nothing except make Americans more vulnerable to scams when they wager online and cost us billions in lost revenue,” Rep. McDermott said.

Under McDermott’s bill, any establishment licensed under Rep. Frank’s legislation would be required to pay a 2% fee on all deposits.  In addition, McDermott’s legislation increases the protections against tax cheating.  Overall, McDermott’s legislation protects Americans who today gamble online at locations that provide little or no protection against fraud and other scams.  Together, the Frank and McDermott bills ensure the collection of existing taxes on income that was moved off-shored and made off-limits a few years ago.

“These are merely the rightful collection of taxes where applicable,” McDermott said and he added: “The billions of revenue that will be collected by the U.S. Treasury under my bill can be dedicated to pay for critically unfunded social safety net programs in America that could improve the lives of vulnerable children and others who deserve our help.”

McDermott said various studies estimate that the legislation could produce $43 billion over ten years for the federal government and additional billions for various state governments.