Get Ready for Mystery and Illusion with The Great Albini Slot [...]
US Casinos against IRS Proposal to Lower Win Reporting Threshold
- March 9, 2015 By Oliver Young -
The American Gaming Association and the US land casino companies are strongly against changing the tax code in the United States. These statements came after IRS proposed lowering the win reporting threshold, something that casinos believe would have a negative impact on the whole gambling industry.
“This would have a very negative impact on business,” said Eric Schippers, who is a senior vice president of public affairs for Penn National Gaming. This company operated 29 casinos in the States. He also added that if there were any changes, then the threshold should be increased due to inflation, not lowered.
Schippers also said that the state could lose $31 million in profit and $15.2 million in taxes if the threshold is lowered. He concluded that Penn National Gaming will most certainly state its opinion during the comment period because the company was very concerned about the possibility of lowering the trigger lever.
From the AGA there have been claims that the change is both unnecessary and unwanted. Representatives said that such change would create additional administrative burdens which could place the whole gaming industry at a competitive disadvantage with other forms of entertainment.
IRS Proposed the Threshold to Be Chopped in Half
According to reports in Tax News, IRS proposed the threshold to be chopped in half. Currently, the law states that any winnings above the amount of $1,200 should be reported by casinos. This threshold was set back in 1977. However, the threshold of $1,200 applies only to winnings from a bingo game or a slot machine; when it comes to keno games, the threshold is $1,500.
IRS now wants any winnings above the amount of $600 to be considered as a taxable income. This number would be universal for all casino games, which means the keno win reporting threshold would be even more severely lowered than the one of slots and bingo games.
It is believed that chopping the threshold from $1,200 to $600 would result with a more machine stoppages while staff fills out the necessary forms on customers’ winnings. Naturally, these stoppages will lead to reduced revenues.
This Is Not the Change Gaming Industry Needs
The gambling industry is very important to the United States since it brings high revenues to the country. In September, 2014, the American Gaming Association published a research which showed that the US gambling industry had approximately $240 billion economic impact.
Therefore, gambling operators believe it is important their comments to be taken into account and let the industry grow even more. According to people who are well informed about this topic, the industry needs a change, but not this one.
Experts have stated that if IRS wants to properly adjust the rate in accordance with the scale, which is almost 40 year old, it should make the new threshold $17,844. The key factor that supports these claims is the inflation that took place through the years.