In the United States, excise taxes are applied to specific goods and services, including legal and illegal gambling transactions. Such taxes are deemed as indirect since they are imposed on transactions rather than individuals or corporations. Excise taxes are often used to regulate activities deemed harmful, such as wagering, alcohol, and tobacco, while also generating revenue for the government.[1][2] Historically, such taxes were known as "sin taxes," created to discourage illegal gambling and manage legal betting operations.[3][4] Excise taxes continue to play a dual role in society: raising funds and serving as a tool for regulation.[5]
The United states tax structure for wagering varies depending on the legality of the activity. IRS Form 730, Tax on Wagering, is used to compute excise taxes for legal and illegal wagers of certain types. While state-authorized wagers are taxed at 0.25%, illegal gambling is subject to a higher tax of 2% to dissuade unregulated wagering.[6] With the growth of modern betting platforms such as daily fantasy sports, the application of excise taxes has expanded to cover these new forms of gambling.[7]
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- ^ "Chapter 7. Dominion Commodity Taxes Excise Taxes, Excise Duties, and Miscellaneous Taxes", Taxation in Canada (3rd edition), University of Toronto Press, pp. 137–145, 1951-12-31, doi:10.3138/9781487582807-010, ISBN 978-1-4875-8280-7, retrieved 2024-10-19
- ^ Wagner, Marcia S.; Salkin, Barry L. (2020-12-01). "Excise Tax on Daily Fantasy Sports". Gaming Law Review. 24 (10): 691–693. doi:10.1089/glr2.2020.29004.mwa. ISSN 2572-5300.
- ^ Wagner, Marcia S.; Salkin, Barry L. (2020-12-01). "Excise Tax on Daily Fantasy Sports". Gaming Law Review. 24 (10): 691–693. doi:10.1089/glr2.2020.29004.mwa. ISSN 2572-5300.
- ^ Coons, John E. (January 1953). "The Federal Gambling Tax and the Constitution". The Journal of Criminal Law, Criminology, and Police Science. 43 (5): 637–642. doi:10.2307/1139648. ISSN 0022-0205. JSTOR 1139648.
- ^ Cnossen, Sijbren (2022). "Excise Taxation To Preserve Health and To Protect the Environment: A Review". Canadian Tax Journal/Revue Fiscale Canadienne. 70 (Supp): 159–184. doi:10.32721/ctj.2022.70.supp.cnossen. ISSN 0008-5111.
- ^ Coons, John E. (January 1953). "The Federal Gambling Tax and the Constitution". The Journal of Criminal Law, Criminology, and Police Science. 43 (5): 637–642. doi:10.2307/1139648. ISSN 0022-0205. JSTOR 1139648.
- ^ Wagner, Marcia S.; Salkin, Barry L. (2020-12-01). "Excise Tax on Daily Fantasy Sports". Gaming Law Review. 24 (10): 691–693. doi:10.1089/glr2.2020.29004.mwa. ISSN 2572-5300.