New Online Gambling Tax Regime Proposed in the US

New Deposit Tax Proposal as US Government Searches for Best Online Gambling Taxation Method

online casinos in America - GamingZion

Perhaps a bit late in its arrival, but a new online gambling tax has been proposed in the US, after the first casinos to take advantage of new American gambling laws came online in Delaware. With more to follow in New Jersey – later this month – and Nevada, as well as other states as and when local legislation is passed, this measure would see a new tax system put in place.

The proposed framework would see online casinos in America subject to a 12% deposit tax, of which 4% would be collected by the state, the rest to be divided between qualified states and tribes in the federal system. The idea is similar to the point of consumption tax proposed in the UK.

With online gambling expected to generate more than $9 billion in revenue by 2020, the government are looking for ways to ensure they collect their share of the income. The current system is Gross Gaming Revenue, and proponents of the new proposal say a more transparent system would be better suited to online and mobile casinos.

Indeed, under a deposit tax system, the tax would be collectable up front, enabling revenue calculation and distribution across multiple jurisdictions. The government would also distribute 8% of the tax income to the state and tribes in which the gambling took place, giving the individual states money back.

The US is still lagging behind other gambling markets after their implementation of legal online gambling. Liberalized markets, such as in Europe, have already gained giant player bases, yet the US market is expected to experience rapid growth in the coming months.

Indeed, the popularity of social freemium casino games has shown that Americans have a real appetite for online gambling, and as soon as the legislation is in place, other states will be sure to jump on board.

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