February 27, 2015

Today Congresswoman Dina Titus of Nevada’s First District introduced H.R. 1108, the Sports Bets Collection Tax Correction Act, and urged Chairman Paul Ryan and Ranking Member Sander Levin of the House Committee on Ways and Means to include this legislation as the committee begins work on tax reform. This legislation repeals a decades old federal handle tax on sports wagers. Originally intended as a source of revenue to pursue illegal sports betting, revenue from the handle tax is now used for other purposes. As the only state with fully inclusive wagering on sports, the handle tax places an undue burden on Nevada companies. Titus’ legislation would save Nevada companies an estimated $9 -$11 million in taxes every year.

A copy of the letter can be read here:

February 27, 2015

Dear Chairman Ryan and Ranking Member Levin,

As you begin your work to reform the tax code in the 114th Congress, I respectfully ask that you consider including legislation that I introduced in the 113th Congress and reintroduced today. The Sports Bets Collection Tax Correction Act (H.R. 5383 in the 113th Congress, H.R. 1108 in the 114th Congress) repeals a decades old tax policy that is outdated and in need of reexamination. When originally imposed, this tax was designed to provide funding for the IRS to investigate illegal wagering operations by imposing a one-time levy on legal wager collection entities, as well as a levy based on the total amount of each wager collected by legal sports books. When I contacted the IRS for additional information, they were unable to confirm that the funding is being used for investigations or in any way related to gaming. 

Because Nevada is the single state with fully inclusive wagering on sports, companies based in our state are the only entities paying this specific tax. Based on discussions with these companies, it is estimated that they pay between $9.5 and 11 million per year. While this is a minuscule percentage of the federal budget, retaining these funds in Nevada would allow for additional job creation and innovation in the gaming industry. 

As you craft your legislation, I respectfully request that you consider eliminating this outdated provision. 

Sincerely,

Dina Titus