GOP blasts idea to tax internet gambling

Republican Ways and Means members on Wednesday sharply criticized bills by Reps. Jim McDermott (D-Wash.) and Barney Frank (D-Mass.) to legalize Internet gambling and raise roughly $42 billion by taxing it. 

"People sometimes resort to drastic things when they are strapped for cash," said Rep. Bob Goodlatte (R-Va.), who testified before the committee. "However, it is unfathomable that Congress wold consider legalizing a currently illegal activity that imposes on the most vulnerable members of our society just to raise money for more big government spending." 

McDermott's tax proposal on Internet gambling was the subject of today's Ways and Means Committee hearing. The bill provides Treasury with the authority to establish regulations and license Internet gambling operators. 

Rep. Wally Herger (R-Calif.), a senior member on Ways and Means, reminded the committee that 4 years ago the House voted overwhelmingly, 317-93, to ban Internet gambling. 

"I should note that 115 Democrats joined nearly all Republicans in supporting the measure," he said, adding, "There are far more pressing issues we should be focused on, like actually creating jobs." 

McDermott said his bill would also create jobs. 

"Don't turn your nose up at 32,000 jobs," he said.  

McDermott likened the fate of Internet gambling to the prohibition of alcohol in 1920s, which failed to stop the consumption of alcohol. He said that Internet gambling by U.S. citizens is already taking place offshore where Congress can't tax it. 

"Federal taxes on alcohol will account for about $100 billion over the next 10 years," he said, adding, "Regulation and taxation has proven to be a better policy for our country when it comes to alcohol and the same is true for online gambling."