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President Donald Trump Jokes About Abolishing Taxes on Gambling Winnings

President Donald Trump's suggestion that he would think about doing away with the federal tax on gambling gains sent the media into a frenzy.  

On Tuesday, while traveling by Air Force One to the Mount Airy Casino Resort in the Pennsylvania Pocono Mountains, Trump was asked if he would think about doing away with the gaming tax.

“Mr. President, I was with you in Vegas when you had ‘No Tax on Tips’ for the hospitality industry. Have you ever considered no tax on gambling winnings?” asked an unidentified journalist.

"No tax on gambling? I don’t know. We have ‘No Tax on Tips,’ no tax on Social Security, and we have no tax on overtime. No tax on gambling winnings? I don’t know about that,” Trump said with a smile and a laugh. “I’m going to have to think about that.”

Trump didn't seem to take his comments very seriously, despite the fact that many news outlets went crazy claiming that the president is considering eliminating taxes on casino profits. Click here to view Trump's remarks regarding gambling taxes.  

Bills to Tax Gambling Are Supported by Both Parties

The gaming sector only wants the deductions for losses against winners to be restored, not the removal of federal taxes on gambling earnings. Beginning the next year, the gambling loss deduction will be lowered to 90% under Trump's One Big Beautiful Bill Act (OBBB).

During his speech at the Mount Airy Casino Resort, Trump made no reference to the gambling-related OBBB tax provision.

Through the FAIR Bet Act, US Representative Dina Titus (D-NV) is attempting to reinstate the gambling deduction in the House. In order to restore the gambling deduction to 100%, US Senator Catherine Cortez Masto (D-NV) wrote the FULL House Act.

Bipartisan support is solid for both measures. Eight Republicans are among the 21 cosponsors of Titus' FAIR Bet. Four Republicans, including Sen. Ted Cruz (R-TX), are among the five cosponsors of FULL House.

According to Cortez Masto, the Senate's Republican leadership is holding up the FULL House Act until pork is permitted to be added to the bill.

"It is a shame that we cannot pass this commonsense FULL House Act because Republicans want to weigh it down with unrelated measures. This is a Republican piece of legislation that is actually causing people to pay taxes on money they lost. It makes no sense,” Cortez Masto said in July.

“There is irony in @POTUS talking about affordability at a casino when tourism is down because of his policies, and the gaming industry struggles without a fix to the 90% tax deduction for gambling losses because of his Big, BS, Budget Bill,” Titus posted on X this week.

Congress has been urged to reinstate the gambling deduction on numerous occasions by the American Gaming Association (AGA), which advocates for the commercial and tribal gaming sectors in Washington, DC, and throughout the country.

“[This] created an unfair precedent by taxing phantom income and uniquely penalizing a legal, heavily regulated activity,” said AGA President and CEO Bill Miller. “We encourage timely action to restore fairness and consistency in the tax code for American consumers.”

Minimal Federal Revenue Gain 

For professional gamblers, lowering the gambling deduction ceiling to 90% would have disastrous effects. The tax benefit is negligible to the federal government.

According to the Joint Committee on Taxation, the rollback of gambling losses would only result in an additional $1.1 billion in government assistance over a period of eight to ten years. Every hour, the federal government spends almost $800 million.