The corporate media is experiencing a collective meltdown over a minor provision in President Trump’s latest tax reform proposal, one that could potentially address not only America’s gambling habits but also the murky networks profiting from them.
This provision aims to limit the deductible amount of gambling losses for taxpayers. Instead of being able to write off a full 100 percent of their losses, gamblers will now be restricted to deducting just 90 percent. This shift means that those who break even, or even incur losses, might still end up with a tax bill.
Currently, under federal tax regulations, both casual and professional gamblers can deduct losses up to the sum of their winnings. In practice, if one wins $100,000 but also loses $100,000, they owe no taxes because their net income stands at zero.
This policy allows high-volume gamblers to sidestep tax obligations as long as they can document their losses to offset their winnings, even if they ultimately see little to no profit.
The new adjustment in Trump’s tax bill modifies this by capping deductibility of gambling losses at 90 percent.
So, in a scenario where one wins $100,000 and loses the same amount, they can only deduct $90,000—leaving $10,000 subjected to taxation as if it were actual income, despite a lack of genuine profit.
This change is projected to generate approximately $1.1 billion for the government and could dissuade high-stakes gambling, particularly for those who currently leverage tax rules to mitigate their risks.
Professional gamblers are outraged. Casino lobbyists are in a frenzy. And progressive lawmakers are scrambling to shield their benefactors.
Newsweek has sensationally claimed this bill might “kill professional gaming.”
Democrats are already asserting that the Kentucky horse racing industry could suffer as high-stakes gamblers may seek alternatives elsewhere.
However, the Democratic discourse conveniently overlooks the estimated 2 million Americans who fit the clinical definition of gambling addiction, along with an additional 5 million grappling with ‘mild to moderate’ gambling issues.
Gambling addiction, or disorder, is a behavioral compulsion where individuals find it impossible to cease gambling despite experiencing significant financial, relational, or mental health repercussions.
This disorder manifests through a loss of control, an incessant preoccupation with betting, chasing losses, deception to conceal the habit, and often escalating bets in pursuit of the same thrill. Much like substance dependencies, it commandeers the brain’s reward system, creating a psychological dependence that supersedes logic and self-discipline. The consequences can lead to financial ruin, fractured families, job losses, depression, and even criminal behavior, marking it as a pressing public health concern.
Democrats argue that this is unfair and assert that the Trump bill could diminish gambling, pushing bettors towards offshore websites. Yet, this outcome may inadvertently assist Americans in escaping the clutches of the gambling industry.
For decades, the gambling sector has enjoyed a concealed government subsidy—a tax framework that has insulated reckless high-volume betting from tangible repercussions.
This arrangement has fueled the proliferation of both legal casinos and an underground gambling economy historically linked to organized crime.
From the inception of Las Vegas to the clandestine corners of New York and Chicago, gambling has served as a favored instrument of organized crime.
The FBI has long documented connections between illegal sports betting rings and criminal organizations throughout New Jersey, New York, and Nevada.
- In 2011, federal prosecutors charged members of the Genovese and Bonanno crime families for orchestrating illegal gambling operations alongside loansharking and extortion.
- In 2021, an undercover investigation in Los Angeles unveiled ties between Asian triads and Mexican cartels to unlicensed casinos and online wagering platforms.
- Even legal gambling has been embroiled in money laundering and skimming operations, most notoriously highlighted in the 1970s Kansas City Mafia skimming scandals that inspired the film Casino.
Organized crime flourishes where monetary transactions are rapid and regulatory oversight is scant. Gambling—especially in its digital and offshore forms—provides a perfect veil for such activities.
By imposing a tax accountability on gamblers, Trump’s bill not only raises revenue.
It casts a spotlight on an industry that has grown far too comfortable operating within the legal and ethical gray areas.
Rep. Dina Titus from Nevada claims the bill would adversely affect her state’s casino economy. Left-leaning media outlets are suddenly alarmed on behalf of poker professionals. However, the average American isn’t swayed. They’ve witnessed the destructive impacts of this industry.
State lotteries exploit vulnerable populations. Sports betting applications target young men predisposed to addictive behaviors. Casino profits often flow to politically connected stakeholders, and when the house thrives, families suffer.
Moreover, many of these sectors are plagued by substantial corruption.
Alabama’s gambling scene has been riddled with scandals, particularly surrounding efforts to legalize electronic bingo.
In 2010, a significant federal probe led to the indictment of casino owner Milton McGregor, multiple state senators, and lobbyists on bribery and conspiracy charges, accused of attempting to manipulate votes to pass pro-gambling legislation.
Although most were acquitted later, the case revealed profound connections between gambling interests and political influence within the state.
Further controversies included allegations of perjury by law enforcement during raids on casinos such as VictoryLand, raising concerns about politically motivated prosecutions and clandestine agreements linked to the control of Alabama’s gambling market.
In Texas, the long-time corrupt former Speaker of the House, Joe Straus, who continues to exercise considerable political influence, reportedly informed lobbyists that his sole ambition was to legalize gambling in the Lone Star State to enrich his family, which owned a horse racing track and had a royalty interest in gambling worth billions upon legalization.
Texas Democrats have previously admitted on undercover camera that the state’s gambling interests and lobbyists have ties to the Bonanno crime family.
States generate approximately $1.8 billion annually from gambling taxes.
However, this revenue pales in comparison to the colossal social costs of gambling addiction.
According to the National Council on Problem Gambling, the annual social costs attributed to problem gambling in the U.S. are around $7 billion, encompassing healthcare, criminal justice, job losses, and family support.
A report from the Guardian suggests the actual social costs could be double that figure, at $14 billion annually.
Trump’s proposal won’t eradicate gambling. But it has the potential to dismantle the tax deduction shield that has previously insulated it from financial repercussions.
By recalibrating the financial dynamics for gamblers, it may assist some in breaking free from the cycle of addiction.
Critics argue this adjustment would impose taxes on “break-even” bettors.
That’s not a flaw; that’s the objective. Gambling must finally confront genuine market pressures instead of being sustained by clever tax strategies and political favoritism.
The tax benefits afforded to the gambling industry have perpetuated addiction.
Trump’s “big beautiful bill” faces backlash from the same factions that have defended the student loan racket, the pharmaceutical middlemen, and social media censors.
Now, they stand in defense of gamblers, casinos, and offshore betting markets.
Trump’s policies aim to support taxpayers and working-class individuals, while Democrats scramble to protect the gambling interests of their wealthy casino donors. This time, it appears the working class may come out on top.
Such policies may come as a surprise from Trump, who was once entrenched in the casino business during the 1980s, boasting high-profile establishments in Atlantic City.
His most renowned venture, the “Trump Taj Mahal,” opened its doors in 1990. By 2009, however, Trump had largely distanced himself from the industry.
Whether you’re a single parent who lost a paycheck to a sportsbook app or a retiree burned by a casino outing, this adjustment is long overdue.
The era of gambling supported by taxpayer subsidies—luring and enabling gamblers to risk more because they could write off all their losses—may finally be winding down.