Should gambling be taxed?

[LinusKS]

Some countries - I've been told - don't tax gambling.

In the US, you're supposed to keep a contemporaneous diary of your wins and losses, when you gamble, and then report all your cumulative winning sessions as income, and then itemize your losing sessions.

Based on my last trip to Vegas, I'm not sure everyone is actually doing this.

But if they are, this method often artificially inflates their taxes, by subjecting them to the AMT, or by depriving them of the standard deduction, or both.

The IRS also effectively freerolls gamblers, since it only allows them to deduct losses up to the amount they've won, but doesn't allow them to deduct gambling losses from other income ("when you win, we win - when you lose, you're on your own.")

But that's not really an argument against taxing gamblers, it's just an argument that the way the US goes about it is particularly cumbersome and ineffective.

So why don't other countries tax gambling?

I don't know, of course, but I think it has something to do with the nature of a wager. Specifically, unless there's juice, after a bet one guy's richer and one guy's poorer, but the net effect is zero.

In other words, gambling, unlike working, doesn't produce anything. And taxes are (or should be) taken out of increases in wealth, not mere transfers of money.

Which is why, for example, you don't have to pay taxes when someone gives you a gift.

Thoughts?

[MissOt]

you are asking a bunch of poker players if they should be taxed... cmon now

[LinusKS]

Hmmm. Are you saying they might be biased?

Actually, I expected, before I posted the poll, most folks would say gambling should be taxed.

[Freudian]

Those who run the gambling should be taxed on their income. The players shouldn't be taxed (they are gambling with money that has already been taxed).

[PoorLawyer]

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Those who run the gambling should be taxed on their income. The players shouldn't be taxed (they are gambling with money that has already been taxed).

[/ QUOTE ]

there is double taxation all throughout the tax code. Get used to it.

[obsidian]

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there is double taxation all throughout the tax code. Get used to it.

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Exactly. You are taxed when you get your money and you are taxed when you spend it virtually everywhere.

[Jim T]

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Those who run the gambling should be taxed on their income. The players shouldn't be taxed (they are gambling with money that has already been taxed).

[/ QUOTE ]

there is double taxation all throughout the tax code. Get used to it.

[/ QUOTE ]

I'd prefer to complain about it and hopefully (and eventually) get it corrected.

[Freudian]

[ QUOTE ]
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Those who run the gambling should be taxed on their income. The players shouldn't be taxed (they are gambling with money that has already been taxed).

[/ QUOTE ]

there is double taxation all throughout the tax code. Get used to it.

[/ QUOTE ]

I think you have misunderstood the topic. The topic is titled "Should gambling be taxed?". Not "is there double taxation".

[Supersetoy]

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<font color="red"> They are gambling with money that has already been taxed </font>

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Exactly. This is why I never understood why they taxed my winnings (although I haven't reported anything as of yet) but there are also situations where we use our bankroll (I would hope most of us) from winnings to receive more...taxing that money "sort of" makes sense.

[lorinda]

So why don't other countries tax gambling?

Those who run the gambling should be taxed on their income. The players shouldn't be taxed (they are gambling with money that has already been taxed).


This is the exact reasoning the UK use.

It also saves them the headache of having people deduct gambling losses from other incomes, which would be the logical continuation of taxing winnings.

Lori