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New Internet Gambling Legislation Would Benefit States, Foster Children

Representative Jim McDermott (D-Wash.) was set to introduce today an updated version of the Internet Gambling Regulation and Tax Enforcement Act of 2010.

McDermott’s legislation would tax online gambling. The changes to the bill would give six percent of taxes to states and tribal governments and earmark some of the money to help foster-care systems. The bill is meant to be a companion to the Internet Gambling Regulation, Consumer Protection and Enforcement Act of 2009 (H.R. 2267), Rep. Barney Frank’s legislation that would legalize and regulate online gambling and poker.

States and tribes would receive a percentage of the money taxed from their jurisdiction, if the bill were to become law. Estimates say that the updated bill would create a total of $72 billion in revenue, with $30 billion going to the governements, and $42 billion for foster-care assistance.

Michael Waxman, spokesperson for the Safe and Secure Internet Gambling Initiative, applauded the updated legislation in a press release:

This legislation is a win-win for federal and state leaders, providing an opportunity to regulate a currently off-shore and underground industry, protect consumers and put to good use tens of billions in otherwise lost revenue. At a time when many policy makers are faced with significant budget shortfalls, it is only common sense to choose regulation that will generate new revenues and create new jobs currently offshore as an alternative to layoffs, program cuts or imposing broad-sweeping taxes that may further depress struggling families and businesses.

The legislation likely needs Frank’s legislation in order to pass first in order to become good law. Online gambling would likely not be taxed until is officially legalized by Frank’s bill, nor would McDermott’s bill likely continue to move through Congress if Frank’s bill is killed. Frank’s bill had a committee hearing in December, but progress since that time has been slow. Frank has said that he’s still shooting to have the bill considered by the House Financial Services Committee prior to June 1st, which is the date that the Unlawful Internet Gambling Enforcement Act is set to take effect in the United States.

The Hill, a publication that reports on happenings in Congress, talked to Steven Adamske, a spokesman for the committee:

Adamske said the bill remains “a priority” but could not say when the legislation would be marked up and sent to the House floor. ‘It is impossible to say that because of the crowded schedule. We just don’t know when,’ Adamske said.

Regardless of the slow progress, it’s an encouraging sign for online poker players that there is still movement on the issue in Congress.

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