Betting companies gaze at renewed optimism as Senators resurrect the WAGER Act in the political sphere of Washington
In a bid to boost local economies and level the playing field for regulated sports betting operators, Senators Catherine Cortez Masto (Nevada) and Cindy Hyde-Smith (Mississippi) have reintroduced the Withdrawing Arduous Gaming Excise Rates (WAGER) Act. The bill aims to eliminate the federal excise tax on sports betting and an annual fee on sportsbook employees.
The WAGER Act is gaining new momentum as the gambling industry faces increasing competition from alternative betting platforms and declining visitor numbers in Las Vegas. Sen. Cortez Masto described the measure as "commonsense legislation" designed to strengthen state gaming revenues and tribal economies.
Under the current tax structure, offshore sportsbooks and unregulated prediction markets face no such tax burden, giving them a competitive edge. The WAGER Act seeks to eliminate the federal 0.25% excise tax on legal sports betting, commonly known as the handle tax, and remove the $50-per-employee head tax on sportsbook staff.
Supporters argue that the federal handle tax creates unnecessary costs for regulated operators. Sen. Hyde-Smith pointed out that Mississippi casinos face similar hurdles. Critics, however, argue that the change in tax rules for gambling losses under the OBBBA unfairly forces gamblers to pay taxes even if they only break even.
In 2022 alone, Nevada sportsbooks saw their handle tax bill hit $22 million, reflecting the growing burden. The WAGER Act is intended to help boost local economies across the United States by reducing the tax burden on legal sports betting operators.
Another legislative initiative includes bills introduced by Representatives Dina Titus (Nevada) and Guy Reschenthaler (Pennsylvania) to repeal the sports betting excise tax, continuing efforts to reduce taxation on legal sports betting in the US. However, the FAIR Bet Act, which sought to restore full gambling loss deductions for players, has recently encountered difficulties. The current tax rules, introduced under the OBBBA, have cut deductions from 100% to 90%.
Rep. Dina Titus tried to attach the FAIR Bet Act to the National Defense Authorization Act (NDAA), but the House Rules Committee declined to include it. The WAGER Act, if passed, could provide a significant relief for the sports betting industry and help stimulate economic growth in regions heavily dependent on gambling revenues.
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