Tuesday, August 3, 2010
Chairman Levin Announces a Hearing on Tax Proposals Related to Legislation to Legalize Internet Gambling May 12, 2010 Ways and Means Chairman Sander M. Levin today announced a full Committee hearing on tax proposals related to legislation to legalize Internet gambling. The hearing will take place on Wednesday, May 19, 2010, in the main Committee hearing room, beginning at 9:30 a.m. in 1100 Longworth House Office Building. CHANGE IN TIME: Originally scheduled for 10:00 a.m., the hearing is now at 9:30 a.m. In view of the limited time available to hear witnesses, oral testimony at this hearing will be from invited witnesses only. However, any individual or organization not scheduled for an oral appearance may submit a written statement for consideration by the Committee and for inclusion in the printed record of the hearing. FOCUS OF THE HEARING: The Committee will discuss the current tax laws and reporting requirements applicable to wagering in the United States. The Committee will consider tax and other proposals in the Committee’s jurisdiction related to legislation pending in the Congress to license and regulate Internet gambling activities. BACKGROUND: The Department of the Treasury (Treasury) has jurisdiction over various statutory provisions related to wagering and gambling. The Internal Revenue Service ensures compliance with the Federal excise and occupational taxes applicable to legal and illegal gambling activities. The taxes are 0.25 percent of the wager and $50 per year, if the wager is authorized under the State law where it is accepted, and 2 percent of the wager and $500 per year, if unauthorized under the State law. Parimutuel wagering, coin-operated devices, and state-conducted lotteries are exempt from taxation. In addition, individual and corporate income taxes, and third-party information reporting requirements, are applicable to income from gambling. Treasury’s Financial Crimes Enforcement Network (FinCEN) monitors compliance with the Bank Secrecy Act and certain other anti-money laundering laws. Under these laws, financial institutions, including casinos and money services businesses must file currency transaction reports and suspicious activity reports to assist the government in detecting and preventing money laundering, tax evasion, or other criminal activities. FinCEN has analyzed the potential regulatory and law-enforcement implications of electronic commerce, including Internet gambling. The Unlawful Internet Gambling Enforcement Act (UIGEA) prohibits any person from knowingly accepting payments in connection with the participation of another person in unlawful Internet gambling. The regulations implementing the UIGEA were issued by Treasury and the Board of Governors of the Federal Reserve System last year and are scheduled to take effect on June 1, 2010. In this and prior sessions of Congress, legislation has been introduced to license and regulate online gambling. Companion legislation, within the jurisdiction of the Committee, would impose gambling licensing fees and certain information reporting and other requirements. DETAILS FOR SUBMISSION OF WRITTEN COMMENTS Please Note: Any person(s) and/or organization(s) wishing to submit for the hearing record must follow the appropriate link on the hearing page of the Committee website and complete the informational forms. From the Committee homepage, http://waysandmeans.house.gov, select “Hearings.” Select the hearing for which you would like to submit, and click on the link entitled, “Click here to provide a submission for the record.” Once you have followed the online instructions, complete all informational forms and click “submit” on the final page. ATTACH your submission in compliance with the formatting requirements listed below, by close of business Wednesday, June 2, 2010. Finally, please note that due to the change in House mail policy, the U.S. Capitol Police will refuse sealed-package deliveries to all House Office Buildings. For questions, or if you encounter technical problems, please call (202) 225-1721 or (202) 225-3625. FORMATTING REQUIREMENTS: The Committee relies on electronic submissions for printing the official hearing record. As always, submissions will be included in the record according to the discretion of the Committee. The Committee will not alter the content of your submission, but we reserve the right to format it according to our guidelines. Any submission provided to the Committee by a witness, any supplementary materials submitted for the printed record, and any written comments in response to a request for written comments must conform to the guidelines listed below. Any submission or supplementary item not in compliance with these guidelines will not be printed, but will be maintained in the Committee files for review and use by the Committee. 1. All submissions and supplementary materials must be provided in Word or WordPerfect format and MUST NOT exceed a total of 10 pages, including attachments. Witnesses and submitters are advised that the Committee relies on electronic submissions for printing the official hearing record. 2. Copies of whole documents submitted as exhibit material will not be accepted for printing. Instead, exhibit material should be referenced and quoted or paraphrased. All exhibit material not meeting these specifications will be maintained in the Committee files for review and use by the Committee. 3. All submissions must include a list of all clients, persons, and/or organizations on whose behalf the witness appears. A supplemental sheet must accompany each submission listing the name, company, address, telephone, and fax numbers of each witness. The Committee seeks to make its facilities accessible to persons with disabilities. If you are in need of special accommodations, please call 202-225-3625 or 202-226-3411 TTD/TTY in advance of the event (four business days notice is requested). Questions with regard to special accommodation needs in general (including availability of Committee materials in alternative formats) may be directed to the Committee as noted above. Note: All Committee advisories and news releases are available on the World Wide Web at http://waysandmeans.house.gov.