26 May 2010
Bingo News: USA set to lift prohibition on Online Gambling companies
The Independent has claimed that the United States are looking into the possibility of lifting internet gambling restrictions. This is the first time a serious debate has been raised about the issue since the Unlawful Gambling Enforcement Act of 2006 was passed. This law was passed with a view that it may minimize web based money laundering as they were not able to locate true receivers of wager placed by bingo, online poker and casino players. The majority of people were in favour of the online banning act as the money from US residents went on to fund terrorist attacks in the US.
It has been nearly four years since the law was passed and now major players in the political world have started a debate on Senate Ways and Means Committee hoping to reverse the 2006 ban. The campaign is being led by Congressman Barney Frank and Jim McDermott.
The campaign is based around three main points, the first being that by allowing online gambling, the federal government and the states can receive $42 billion by taxation within 10 years. The companies will then have to pay 2% tax to the government and 6% to the state that issued the gambling licence. There will also be taxes added to the player’s winnings with Jim McDermott stating: “We are sending a multi-billion dollar industry offshore and underground. As a result, we are making tax criminals of Americans who can’t declare their online winnings to the IRS”.
The second point is that there will be over 32,000 new jobs created within the legitimate onshore companies that are linked with the online gambling industry without counting the new jobs that have been created in the states and to the federal government that will take care of issue and keeps tabs on the online gambling applications.
The third point is that based on statistics, the 2006 ban did not succeed in providing a working solution with regards to the destination of funds. Research firm H2 Gambling Capital has said that the figures for offshore gambling in the US are near enough the same as they were in 2006, after falling by a third due to the ban, to a predicted $6 billion this year.
Lots of companies who were excluded from the US market are looking to make a comeback with PartyGaming and 888.com which are two of the largest companies in the World, making moves towards this. PartyGaming is in talks with brick and mortar casinos in the US about the possibility of some joint ventures provided the laws are relaxed at a federal level or decided by on individual states. 888.com is currently staying close to American casino giant Harrah’s.