Online gambling bills could reap up to $42B in new revenue

A report from a key congressional committee suggests that the U.S. would collect as much as $42 billion in tax revenue under a bill legalizing online gambling.

An analysis conducted by the Joint Committee on Taxation (JCT) and released by Rep. Jim McDermott (D-Wash.) found that a bill to legalize, regulate, and tax online gambling could reap tens of billions in revenue over the next 10 years.

McDermott, along with Rep. Barney Frank (D-Mass.), have introduced legislation to repeal a section of the 2006 SAFE Port Act, which effectively criminalized a company from running internet gambling within the U.S.

Frank's bill would legalize the gambling, while McDermott's bill would tax and regulate it.

The JCT estimate is based on the expected revenues collected from federal licensing fees companies would have to pay in order to operate online gaming within the U.S.

On the low end, the JCT report projected a minimum of roughly $10 billion in new revenues over the next decade.

“This analysis further reinforces the fact that a regulated environment will generate billions in new revenue to offset the costs of health care reform or other vital government programs,” said Michael Waxman, spokesperson for the Safe and Secure Internet Gambling Initiative, a group which promotes legal online gambling.

“With the completed analysis, and support for Internet gambling regulation growing daily, it’s only a matter of time before Congress acts and begins allocating the billions in new revenue sitting on the table to one program or another," Waxman added.

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