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Kentucky House Pass Tax On Wagering From Home On Horse Racing

government pardon
by lisby1

Article by Steve Dickson

The Kentucky House has passed House Bill 368, sponsored by Speaker Pro Tem Larry Clark, D-Louisville. This Bill will place a 1/2% tax on advance wagers placed by Kentucky residents using their phone or on-line accounts. The vote was 85 to 8 in support of the Bill. The Bill now advances to the Senate. This tax similar to those implemented by the states of Illinois and Virginia on similar types of on-line and telephone count wagering.

Speaker Clark, in support of the Bill, claims that an amount of approximately 0,000 per annum can be raised through this tax although this can not be proven as there are no authoritative figures proving how many Kentucky residents place their bets this way. A Word copy of the draft Bill can be found here.

taxes raised form this collection will be split equally between the Kentucky Horse Racing Commission, the track the bet was placed with, and the final portion would supplement the venue’s cash prizes. Whilst this seems a good idea, I cannot fathom why the government have a right to intercede in this way. In my opinion it is up to the venues themselves to make themselves attractive enough for people to want to attend and spend their money there. It is Big Brother acting as far as I am concerned.

What impact does this have for the thousands of Kentucky residents that play poker on-line? Well at present there still is an ongoing court battle to rid the state of over 140 internet gambling sites. The Kentucky Justice and Public Safety Cabinet, led by J. Michael Brown, has been on an two year campaign against the owners of these domain names, some of them owned by industry “super-powers like PokerStars and Full Tilt Poker. In September 2008, the State seized the rights to the domain names and battled for their rights to keep them before members of the internet gambling industry stepped in. The Interactive Media Entertainment and Gaming Association (iMEGA) is leading the campaign for the sites concerned. In October 2009 iMEGA, along with several of the sites lawyers, put their case to the Kentucky Supreme Court. A ruling for this is expected after the end of this month although it could be much later.

Judge Thomas Wingate upheld the State’s actions in seizing the domains, in an October 2008 ruling before the Kentucky Court of Appeals overturned it by a 2 to 1 margin in January 2009. Now that the Bill has been passed for the taxing of horse racing wagers, does that sound the death knell for the Internet companies at stake?

Obviously Internet poker is a different beast to horse racing, if you’ll pardon the pun. In the case of poker there are no “venues” to subsidise so all of the money will be taken directly to government if a similar scheme were to be adopted. If indeed the Kentucky legislature were to succeed in totally closing down the 140 domains, all the domains will do is move elsewhere. Is that what the people of Kentucky want? What is the beef that the American authorities seem to have with poker anyway? I have never fully understood it. Do we want to get back to the days of Al Capone and the gangsters running card dens? Are we wanting to return to the days of Prohibition? I think not. We all know how that worked didn’t it? It is amazing though to think that the British Government has in the last few years ABOLISHED the taxes on wagering. I for one agree with its abolition. If I choose to spend my money on a wager, it has already been taxed at source, why should the government, even on behalf of someone else, get another bite at it. I WOULD see the sense however in taxing any winnings. To me that would be a much fairer thing to do.

I suppose we will have to wait and see how the Kentucky Supreme Court rules but if the last few days in the House are anything to go by I would think that Internet poker in Kentucky has a bumpy road ahead for itself.

About the Author

An amateur poker player writing for players of all abilities.

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