Newly introduced legislation in the U.S. calls for a federally regulated system to provide residents with online poker and other games of skill.
The bill, introduced by Senator Robert Menendez of New Jersey, is, according to a press release, designed to generate revenue while protecting families by excluding predatory online gaming sites that target minors.
Menendez’s legislation calls for potential online operators to undergo a thorough review by the Treasury Department. The review will look at business records, the financial condition of the applicant, corporate structure and other background checks. If approved, licenses would be good for five years, with renewal subject to the same requirements as first obtaining a license.
Licensed sites would pay a 10 percent tax on deposits into playing accounts. Those proceeds would be split evenly between the federal government and the state where the player is located.
“Pulling internet poker out of the shadows and into the light of the law, we have the opportunity to help our economy while protecting our families,” Menendez said in the press release. “By bringing these games of skill into the mainstream, we can generate billions in revenue for businesses and the Treasury during these tough times.”
The bill, which is being called the Internet Poker and Games of Skill Regulation, Protection and Enforcement Act, is similar to legislation introduced in the House by Rep. Barney Frank, called the Internet Gambling Regulation, Consumer Protection and Enforcement Act.
Menendez’s bill, however, also addresses a parimutuel concern. His legislation scraps the 25 percent federal withholding tax on parimutuel wins in excess of $5,000, and increases the amount of reportable winnings from $600 to $1,200.
“This bill was drafted with input from numerous stakeholder groups, including the National Thoroughbred Racing Association, which will help bolster its chances for passage. The bill is limited to online poker, carries strong consumer protections, respects states’ rights, and ensures that domestic U.S. industries-including the horse racing industry-are allowed to participate fully and with equal opportunity in future internet gaming
The NTRA prefers the Menendez bill to Frank’s legislation because it addresses horse racing issues.