| T O P I C R E V I E W |
| PartyT |
Posted - 06/19/2011 : 6:16:54 PM
House Internet gambling bill would require withholding taxes on winnings
A House proposal to regulate and tax Internet gambling would require online gambling establishments to withhold taxes from net online winnings, and provide detailed information about gamblers to the government in an attempt to help ensure the collection of these taxes. It would also impose a two percent federal tax on Internet gambling providers, and give states the option of taxing these companies at a rate of six percent.
The Internet Gambling Regulation and Tax Enforcement Act, H.R. 2230, was introduced Thursday by Reps. Jim McDermott (D-Wash.), John Campbell (R-Calif.), and House Financial Services Committee ranking member Barney Frank (D-Mass.).
The bill would not legalize online gambling, and is meant to offer a tax structure for online gambling assuming that it becomes legal. Reps. Campbell and Frank are known to be working on a bill to legalize Internet gambling.
Gambling winnings are already required to be reported to the IRS under current law. Assuming online gambling is legalized, the bill would require companies to subject net online winnings to a withholding tax, now 28 percent, in line with current withholding taxes for other gambling winnings.
To help enforce this, companies would be required to provide the names, addresses and tax identification numbers of all players to the government. They would also have to provide information on gross winnings, gross wagers and gross losses on each person for every calendar year, and the amount of tax withheld on these winnings.
By Pete Kasperowicz
http://thehill.com/blogs/floor-action/house/167091-house-internet-gambling-bill-would-require-withholding-taxes-on-winners |
| 1 L A T E S T R E P L I E S (Newest First) |
| PartyT |
Posted - 06/20/2011 : 07:59:04 AM
This article is very interesting.
States look to Internet taxes to close budget gaps
AUSTIN, Texas — State governments across the country are laying off teachers, closing public libraries and parks, and reducing health care services, but there is one place they could get $23 billion a year if they could only agree how to do it: Internet retailers such as Amazon.com.
That's enough to pay for the salaries of more than 46,000 teachers, according to the U.S. Bureau of Labor Statistics. In California, the amount of uncollected taxes from Amazon sales alone is roughly the same amount cut from child welfare services in the current state budget.
But collecting those taxes from major online retailers is difficult.
Internet retailers are required to collect sales tax only when they sell to customers living in a state where they have a physical presence, such as a store or office. When consumers order from out-of-state retailers, they are required under state law to pay the tax. But it's difficult to enforce and rarely happens.
That means under the current system the seller is absolved of responsibility, buyers save 3 percent to 9 percent because they rarely volunteer to pay the sales tax, and the state loses revenue.
By CHRIS TOMLINSON
http://www.msnbc.msn.com/id/43455123/ns/us_news/
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