Federal excise tax and professional sports integrity on the agenda for Titus

Nevada Rep. Dina Titus
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Although she could not attend in person, Congresswoman Dina Titus still made her presence felt at last week’s SBC Summit North America.

In a 15-minute video message played at the event, Titus reiterated her support for repealing the federal excise tax on sports betting and also laid out five recommendations for sports organizations to combat sports betting issues within professional sports.

Federal excise tax on betting handle

Titus, who co-chairs the Congressional Gaming Caucus, has been an opponent of the federal excise tax on sports wagers for over a decade. Currently, a sports betting operator is required to pay a 0.25% tax on its total sports betting handle. 

In her video message, she said that the tax “serves no dedicated purpose” and instead “penalizes” the regulated industry. She added the tax “empowers illegal operators” as they can attract customers by offering better odds due to not paying the tax.

Titus has put forth numerous bills over the past decade to repeal the federal excise tax however they have never gained momentum. Her latest effort, HR 1661, was introduced in March 2023 and is co-sponsored by both Republicans and Democrats.

Titus was also critical of the Gambling Addiction, Investment, and Treatment Act (GRIT) which proposes to take half of the funds generated by the federal excise tax on sports betting and apply it to problem gambling funding.

“I’m all for investing in responsible gaming resources. We do it in Nevada and we want to prevent problem gaming,” said Titus. “However, using the handle to do this only hurts the legal operators. Operators already invest millions of dollars into responsible gaming resources and research and each state sets aside money for this issue.”

The American Gaming Association (AGA) is also in opposition to the GRIT Act and supports the abolition of the federal excise tax.

“The AGA opposes the GRIT Act and will continue to educate Congress about why enacting bipartisan legislation to repeal the excise tax on legal sports betting operators is necessary to ensure we can effectively migrate Americans into the protections of the regulated market,” said AGA Senior Vice President, Government Relations Chris Cylke in a statement following the introduction of the GRIT Act.

Titus sets out five recommendations for Sports organizations

In the second part of her video message, Titus addressed the problem of sports gambling issues in professional and college sports. Since the start of the year, there have been high-profile incidents in a number of major sports. 

Last month Toronto Raptors player Jontay Porter was handed a lifetime ban from the NBA following an investigation into prop bets placed on his performance in several games. 

Titus explained that she had contacted each of the major professional sports leagues and the NCAA regarding their sports betting policies. Last year she penned a letter to NFL Commissioner Roger Goodell calling on the league to be more transparent about its gambling policy following the investigation into Indianapolis Colts player Isaiah Rodgers Sr.

She laid out the five recommendations she has for sports leagues to improve integrity which are as follows:

  • Simplify the rules to focus on integrity
  • Maintain a publicly available database of violations and punishments.
  • Mandatory in-person training at the beginning of each season for all league personnel
  • Conduct annual surveys to ensure player input and understanding of policies
  • Expressly prohibit the use or promotion of illegal sportsbooks

“Increased education of players and coaches about League policies regarding sports betting would assure fans that the games they watch and often bet own are indeed fair,” added Titus. “I found that while the leagues take these issues seriously and have developed some comprehensive rules and programs to ensure compliance, they still have more work to do to publicize transparency measures, increase education efforts, clarify the rules, and standardize the penalties.”

She was also keen to stress that at this stage she is not calling for the federal government to be involved in setting league policies.

Titus finished off by setting out her vision for the future of sports betting and touched on some of the challenges she anticipates the industry will face, such as cryptocurrency, AI, cyber security, and the rise of non-traditional sports and non-sporting events.

“Following rapid expansion over the past six years, there now appears to be an increased level of scrutiny and there will continue to be growing pains. I hope that the industry will continue to innovate, self-regulate, and share its best practices,” concluded Titus. “My goal is always to avoid excessive regulation at the federal level that will only drive customers to the illegal market.”