Internet Poker Bill Introduced in Congress

The racing industry has expressed some interest in regulation of online poker.

Republican U.S. Rep. Joe Barton of Texas has introduced legislation that would legalize Internet poker but no other forms of online casino gambling.

The bill calls for home rule in that each state would have the option of allowing online poker, which would be taxed. The measure states any company that applies for a license must already have a gambling license in the United States.

Currently, online pari-mutuel wagering on horse races is the only legal form of Internet gambling. Racing industry representatives, however, have expressed interest in Internet poker as a way of generating revenue, perhaps for purses.

Churchill Downs Inc. is one company that has been closely following the developments, while the state of New Jersey has addressed in-state Internet gambling. Reports claim online poker is a $6 billion industry in the U.S.

In December 2010 the National Thoroughbred Racing Association said it would support Internet poker legislation if changes are made to benefit horse racing, including clarification of the legality of interstate and online pari-mutuel wagering on horse races; tax exemptions for advance deposit wagering; elimination of the pari-mutuel withholding tax; and changes in the reporting requirements for winnings to mirror those of casinos.

The Unlawful Internet Gambling Enforcement Act of 2006 basically bans online betting—with the exception of wagers made on pari-mutuel horse racing—by restricting use of credit for such wagers. Some U.S. lawmakers, however, have called for legalization and taxation of online betting.

The American Gaming Association, which represents casino interests in Washington, D.C., stopped short of endorsing the Barton bill but said it supports the licensing and regulation of Internet poker.

“Although the AGA has not endorsed any specific legislation on this issue, we are pleased that Rep. Barton wants to protect American consumers and understands the need for regulating online poker in our country,” the organization said in a statement. “The millions of Americans who are playing poker online deserve to know they are playing safely with law-abiding operators, but strong enforcement of illegal operators and unambiguous U.S. laws governing online gambling are equally vital.

“We look forward to continuing to work toward a solution that will meet these two goals and keep the jobs and revenues associated with this billion-dollar industry in the United States.”

Barton told The Associated Press he believes the legislation has a chance to move forward in the current Congress.