Trump Hints at Abolishing Tax on Gambling Winnings

Speaking to reporters on Air Force One, the president said he would “have to think about” whether to eliminate the federal tax on gambling payouts, drawing immediate attention from lawmakers, industry groups and tax experts. The remark was noncommittal, and no legislative text or timetable was provided by the White House. The comment follows other tax-policy proposals floated by the administration this year and comes as federal budget deficits remain a central concern for economists and policymakers.

Under current tax practice, many gambling proceeds must be reported to the Internal Revenue Service and certain large prizes are subject to withholding. Taxpayers can generally deduct documented gambling losses against winnings when they itemize deductions. States maintain separate rules, and many continue to tax gambling income, meaning a federal change would not automatically eliminate all tax obligations for winners.

Industry trade bodies and casino operators reacted cautiously. Some executives said removing the tax could be marketed as a consumer-friendly change, while others warned it would offer only marginal benefits to most recreational players and could complicate reporting systems. The American Gaming Association and leading operators have not called for sweeping federal exemption but have pressed for simplified reporting and clearer rules for online and mobile wagering.

RELATED TOPICS: Regulation