Add DraftKings CEO Jason Robins to the list of those in the gambling industry who are speaking out against the possible gambling tax changes in the recent spending bill.
Robins appeared on CNBC to chat with Jim Cramer about the company’s stellar earnings report. However, Cramer couldn’t conduct the eight-minute interview without bringing up the gambling tax issue.
First, he called it a “strange change.” Then, Robins said he thought the provisions were put in the bill as part of a “technicality to follow the Byrd rule.” The Byrd rule bans “extraneous” matters in the budget reconciliation process.
As Cramer pointed out in the question, the new tax code could have gamblers paying taxes on money they didn’t win. For example, if a poker player wins $100,000 in a single tournament. Then, loses $100,000 over the course of the rest of the year, he could only write off 90% of the $100,000 worth of losses.
In other words, he would owe taxes as if he won $10,000.
“I don’t think that there was really total understanding of what that meant,” said Robins. “I do think there’s been some appetite, you’ve seen, to fix it.”
He added that the company started working with federal lawmakers to change the tax code.
“I do think it’s something that doesn’t make sense,” said Robins. “If you can’t deduct all your losses, how does that make sense that you pay income tax on something that’s not actually income?”
You can watch the whole interview below:
DraftKings Becomes First Solely Online Operator To Voice Concerns
Robins isn’t alone in his displeasure with the possible changes. Las Vegas casino owner Derek Stevens and poker pro Doug Polk have both been vocal about their disdain for the changes.
Stevens told local media he believes the change would hurt the Las Vegas economy. He believes fewer people would gamble because of the tax change. Consequently, the declining gambling revenue would cost local workers their job.
Polk represents the for-profit gamblers who are trying to make money from gambling. He was recently on News Nation to talk about how the change would destroy the livelihood of many bettors.
However, Robins’ comments are the first to come from a solely online gambling platform. Unlike Polk and Stevens, Robins didn’t mention revenue, incomes, or jobs. Instead, he just focused on the lack of logic behind taxing gamblers on money they didn’t win.
On the bright side for gamblers, there is bipartisan support for repealing this language. Rep. Dina Titus filed the FAIR BET Act, Sen. Catherine Cortez Masto filed a similar bill in the upper chamber, and Rep. Andy Barr was the first Republican to file legislation to axe the changes.
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