Representatives Dina Titus (D-Nev.) and Guy Reschenthaler (R-Pa.) have reintroduced legislation aimed at repealing the federal excise tax on sports betting, marking their fourth attempt to eliminate what they describe as an outdated burden on legal gambling operators.
The Discriminatory Gaming Tax Repeal Act of 2025 targets two specific federal impositions: the 0.25% "handle tax" on all legal sports wagers and a $50 annual tax on each sportsbook employee. If passed, the bill would remove federal taxation that has existed since 1951, long before the Supreme Court's 2018 decision that allowed states to legalize sports betting.
Titus, who co-chairs the bipartisan Congressional Gaming Caucus, argues that the federal tax unfairly penalizes legitimate businesses operating in the 38 states and Washington D.C. that have legalized sports betting.
"Illegal sportsbooks do not pay the 0.25 percent sports handle tax and the accompanying $50 per head tax on sportsbook employees, giving them an unfair advantage," Titus said. "I once asked the IRS where the revenue from the handle tax went in the federal budget and they didn't even 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 American Gaming Association (AGA) has thrown its support behind the legislation. AGA CEO Bill Miller has stated that the tax places legitimate operators at a competitive disadvantage against offshore and illegal bookmakers that avoid all taxation and regulatory compliance costs.
The tax is particularly burdensome because it applies to the total amount wagered (handle) rather than profits. Since sportsbooks typically retain only 5-10% of the handle as revenue, the effective tax rate on actual profits can be significant.
This marks the fourth time that Titus and Reschenthaler have introduced the legislation, following unsuccessful attempts in 2019, 2021, and 2023. Previous versions of the bill failed to advance beyond House committees.
The renewed push comes during one of the busiest periods for legal sports betting in the United States. According to the American Gaming Association, Americans were projected to wager approximately $3.1 billion on this year's NCAA March Madness basketball tournaments, an increase from the $2.7 billion wagered during the 2024 tournaments.
The bill's supporters point to the economic contributions of legal sportsbooks in states that have embraced regulated betting markets:
In Nevada, 66 licensed operators handled $8.26 billion in sports wagers in 2023, generating $481.3 million in revenue and contributing $32.5 million in state gaming taxes.
New York, currently the nation's largest sports betting market, saw its 19 licensed operators process $19.18 billion in wagers, producing $1.7 billion in gross gaming revenue and $862.6 million in state tax revenue.
The legislation has been referred to the House Committee on Ways and Means for consideration. It would need to pass through committee review and receive approval from both the House and Senate before becoming law.