A proposed $1.1 billion tax hike, reportedly included in President Donald Trump’s tax bill, is raising alarms among gamblers and the betting industry. The change would alter how poker players and sports gamblers are taxed, potentially slashing their net winnings and even imposing income tax when they break even or lose money.
Under current rules, gamblers who itemize can deduct all their losses against winnings, meaning they pay tax only on net profits. The proposed changes could eliminate this ability, leading to a scenario where gross winnings are taxed without full consideration of losses, significantly impacting profitability for bettors.
This potential federal regulatory shift introduces considerable uncertainty and risk for DraftKings and the broader online gambling market. A reduction in the attractiveness of betting due to higher taxes could lead to decreased player engagement and a potential shift towards unregulated markets, impacting legal operators' revenue.
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