The Biden Administration is going to bring a lot of changes to Trumpian policy when the transition of power takes place in January. There has been a lot of talk about what the Biden Administration will do with taxes, healthcare, and security, but little has been mentioned about his intentions with the sports betting industry. This includes retail sportsbooks as well as platforms to bet online. Industry experts have taken guesses about what sports betting will look like under Joe Biden, but nothing will be certain until he takes office.
The Legalization of Sports Betting
Prior to 2018, sports betting was illegal in the United States since 1992. It was deemed illegal under the Professional and Amateur Sports Protection Act (PASPA) which was enacted in 1992. President Trump was in office when the act was repealed by the Supreme Court. This was a Supreme Court where the swing vote favored liberal policy. With Justice Amy Coney Barrett replacing the late Ruth Bader Ginsburg, the swing vote now favors conservative policy.
Since PASPA was deemed unconstitutional, 22 states have legalized some form of sports betting. There are some states that just have retail books. There are others that just allow online betting. Some states have legalized both forms of sports betting.
Sports betting has been financially beneficial for most states who have enacted such a policy. Residents of many legal states have exceeded betting projections which has sparked interest in legislatures where betting is illegal to bring sportsbooks to their respective states.
President Trump’s Stance on Sports Betting
Sports betting was legalized under President Trump’s term. However, he didn’t support the legalization of sports betting. President Trump sided with the professional sports leagues to not legalize sports betting. Professional sports felt that they would lose money to the betting industry on their competitions. They wanted to take a guaranteed cut of the massive revenue figures that legal sports betting would create for sportsbooks and state governments.
President Trump sided with the leagues, but nothing was officially done under his administration to regulate legal sports betting after PASPA was repealed.
Expectations for Sports Betting Under President Elect Joe Biden
Surprisingly, President Elect Biden has a similar position to President Trump on sports betting. Joe Biden never made a direct statement surrounding the gaming industry during his campaign. However, he does believe that the state and federal government should work together to regulate the betting industry. This is an indication that sports betting policy will change under Joe Biden in some capacity.
Most likely, sportsbook taxes will rise under the Biden Administration. Joe Biden made his stance on taxes clear throughout his campaign. He is going to tax businesses that make a lot of money. Retail sportsbooks, as well as the online sports betting industry, generate a lot of revenue every year in many states. They could see their taxes raised substantially. Most states already have a very high tax rate for sportsbooks so this will be objected to by bookies throughout the country.
The Professional Sports Leagues
Professional sports leagues want regulation on sports betting so they can profit from the success of the industry. The four major sports leagues have all expressed their thoughts on the regulation of the sports betting industry. Individual states have their own legislation in place which determines the amount that leagues benefit from sports betting.
The professional leagues want federal regulation so there is uniform policy in place for how they’ll be compensated. The unanimously suggested amount is 1% of total sports betting revenue would go to each league, but this is just a suggestion as of December 2020.
The expectation under Joe Biden is that bookies will lose money in some capacity. The percentage of revenue is unknown, but a federal regulation of sports betting is probable under Joe Biden.
Despite this, sports betting is not the first policy to deal with on the new administration’s docket. The sports betting industry is bound to change, but it will not be an overnight transformation. Joe Biden has stated that it will take over a year to change Trumpian policy, so sports betting should look similar in the United States for an extended period of the Biden administration.
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