Lawmakers Renew Effort to Scrap Sports Betting Excise Tax

In another push toward the repeal of the federal excise tax on sports betting, the bipartisan co-chairs of the Congressional Gaming Caucus, reintroduced a proposal calling to eliminate the so-called “handle tax.” On Tuesday, Reps. Dina Titus and Guy Reschenthaler, reintroduced the legislation which proposes to eliminate the 0.25% federal excise tax on sports betting.

Another Push to Eliminate Handle Tax

The handle tax was first introduced back in 1951. At the time, the tax sought to combat illegal gambling by implementing a 0.25% tax on all placed legal sports bets. In addition, the federal excise betting tax enforces $50 per head for every sportsbook employee.

The latest effort comes after Reps. Titus and Reschenthaler have made several attempts to push forward the legislation that proposes to eliminate the federal excise tax. Highlighting the economic importance of sports betting since its expansion started in 2018, the Representatives have filed the legislation in 2019, 2021 and 2023, in an effort to benefit the legal sector. Now, a fresh effort focuses on the same goal, ultimately seeking to benefit the legal bookmakers.

The Federal Excise Tax Benefits the Illegal Sector, Punishes Legal Bookmakers

Congressman Reschenthaler spoke about the gambling sector across the United States, explaining that it provides employment for more than one million people. He added that the sector generates more than $70 billion for local and state governments. What’s more, Reschenthaler pointed out that in Pennsylvania alone, some 33,000 jobs are supported by the legal gambling sector.

However, the Congressman said that outdated tax codes and “burdensome regulations” benefit the illegal sector, while hindering the growth of the legal betting operators. “The Discriminatory Gaming Tax Repeal Act of 2025 will ensure the gaming industry can support good-paying jobs and promote economic growth in southwestern Pennsylvania and across the nation,” he added. Finally, Reschenthaler said that he is excited to join forces with Rep. Titus for this proposal and encouraged the House to support the legislation.

“The Discriminatory Gaming Tax Repeal Act of 2025 repeals a tax that does nothing except penalize legal gaming operators for creating thousands of jobs in Nevada and 37 other states around the nation.“

Rep. Dina Titus

Congresswoman Titus confirmed that the reintroduced proposal seeks to eliminate a tax that only serves as a penalty for legal operators. She added that black market and illegal bookmakers do not pay the 0.25% tax on betting handle, nor are subjected to the $50 pay per sportsbook employee. According to Titus, this gives the illegal sector “an unfair advantage.”

Titus reiterated the time she asked the IRS where the revenue from the betting handle tax was going and received a response that they didn’t know. “It makes no sense to give the illegal market an edge over legal sports books with a tax the federal government does not even track,” the Gaming Caucus co-chair explained in conclusion.