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New hope for U.S. net gambling regulations
Rep. Jim McDermott reintroduced his bill to tax online gambling in Congress on Tuesday and Rep. Barney Frank's bill to legalize and regulate the industry has a hearing set for April, giving renewed hope that the U.S. online gambling ban is on the way to being reversed.
Frank (D-Mass.) introduced H.R. 2046, the Internet Gambling Regulation and Enforcement Act, last year. Its purpose is to legalize and regulate online gambling. It has since garnered 46 co-sponsors, but hasn't moved much closer to a vote in the House of Representatives.
Not long after he introduced his bill, McDermott (D-Wash.) introduced a companion bill seeking to tax the online gambling industry. McDermott reintroduced his bill on Tuesday as H.R. 5523, the Internet Gambling Regulation and Tax Enforcement Act.
According to the Safe and Secure Internet Gambling Initiative, the reintroduced legislation strengthens provisions in the earlier version of the bill and includes an enhanced reporting mechanism under which licensed gambling operators are required to provide each customer with an annual statement of winnings and losses.
The new version also establishes a 2% licensing free that is paid by the operator to equalize the costs of operation in providing gambling services online, as opposed to brick-and-mortar casinos that provide in-person services.
The revenues that could come from the online industry have been estimated between $8.7 billion and $42.8 billion over 10 years, according to an analysis by PricewaterhouseCoopers.
SSIGI points out in a press release that the revenues aren't necessarily from newly created taxes, but would come from taxes required under existing laws. McDermott's bill would be a framework to collect those taxes.
The bill was sent to the Ways and Means Committee after its introduction on Tuesday. Because the bill acts as a companion bill to Barney Frank's, there isn't much that can be done with it until there is more movement on the IGREA.
The IGREA was introduced by Frank in April 2007 and referred to the House Financial Services and House Energy and Commerce committees. The only move made since is that the Energy and Commerce Committee referred it to the Commerce, Trade and Consumer Protection subcommittee on April 30, 2007.
Frank has been waiting for the bill to garner a groundswell of support before advancing it, according to a Polito.com news story.
The bill may be seeing a lot more movement now, though. Last week Rep. George Miller (D-Calif.), a powerful ally of House Speaker Nancy Pelosi (D-Calif.), signed on as a co-sponsor to the Frank legislation. Now Frank has a hearing scheduled for April that he will use to highlight the problems anti-gambling regulations have created for banks and other financial institutions.
Despite all the recent activity in the matter, Frank Fahrenkopf, president of the American Gaming Association, expressed doubt that the laws will be changed anytime soon.
"I still think the odds are very long that a bill (to repeal the Internet gambling ban) will pass in this Congress," Fahrenkopf said in the Las Vegas Review-Journal.