Offsetting Bills Face off to Challenge One Big Beautiful Bill Gambling Tax
Two competing bills are now in play on Capitol Hill as lawmakers seek to restore the gambling losses tax deduction to its previous 100% level.
LISTEN TO THIS ARTICLE:The provision capping gambling loss deductions at 90% of winnings was included in the large tax and spending bill signed into law by President Donald Trump in July. That measure is scheduled to take effect next year and has been criticized by gaming industry leaders who say the change could have significant economic impacts, particularly on horse racing in states without supplemental purse revenues such as California.
Related: Fair Bet Act to Reverse Controversial Gambling Tax Fails to AdvanceOne of the new measures seeking to reverse the cap is the Winnings And Gains Expense Restoration Act of 2025, also known as the WAGER Act. The bill was introduced by Kentucky Congressman Andy Barr, who currently serves as chairman of the Congressional Horse Caucus.
Barr emphasized that the legislation is bipartisan in nature and said he intends to push it forward in the same way previous reforms in horse racing were enacted, including the Horseracing Integrity and Safety Act. He highlighted that the tax restoration could provide vital support for the horse industry in Kentucky and beyond.
The WAGER Act initially had only one co-sponsor, Troy Nehls of Texas. It has since gained additional support with Kentucky's Morgan McGarvey joining as a co-sponsor. Barr described the legislation as essential for the gambling and racing industries, pointing to past bipartisan cooperation on issues critical to the sport. His statement also drew connections to economic successes such as record-breaking yearling sales following other tax reforms.
Kentucky State Senator Damon Thayer, who has served more than two decades in the legislature, praised Barr for introducing the bill. He described the 90% cap as an alarming development and characterized the current push to restore the full deduction as a triage effort. Thayer said momentum is crucial and that Barr, as a majority party member, is well-placed to champion the cause.
More Regulation News
Politicking for Position
Barr's political profile is heightened as he campaigns for Sen. Mitch McConnell's soon-to-be-vacant Senate seat. He faces a Republican primary against former state attorney general Daniel Cameron and political newcomer Nate Morris. The tax issue could play a role in Barr's campaign as he positions himself as an advocate for Kentucky's thoroughbred racing industry.
A competing measure has also been filed. Rep. Dina Titus, a Democrat from Nevada, introduced the Fair Accounting for Income Realized from Betting Earnings Taxation, or FAIR BET Act. Her legislation also aims to restore the 100% deduction but has been stalled in the House Ways and Means Committee. Observers attribute its lack of progress to the Republican trifecta currently holding the presidency, Senate, and House of Representatives.
The National Thoroughbred Racing Association (NTRA) has noted that Barr's WAGER Act may have a stronger chance of success due to Republican support in Congress. The bill could advance either as an attachment to larger tax legislation or on its own. Titus previously attempted to attach her FAIR BET proposal to the 2026 National Defense Authorization Act but was unsuccessful.
Tom Rooney, president and CEO of the NTRA, explained that if Congress restores the full deduction during 2026, the change would be applied retroactively to the beginning of the year. He and Thayer both noted that, to date, no organized opposition has emerged against Barr's bill.
RELATED TOPICS: Regulation
Review this New Post
Leave a Comment
User Comments
Comments for Offsetting Bills Face off to Challenge One Big Beautiful Bill Gambling Tax