Online Gambling US Economy

February 1, 2012

On the 23rd of December 2011, the U.S. Department of Justice (DOJ) made some very broad changes to the Wire Act of 1961. Half a decade ago, when telephones were something new, this act was put in place to stop any type of gambling or sports book being run across state lines using telephones or telegram. At the time it was a sensible new piece of legislation, but fast forward 50 years and it is an archaic set of laws which does nothing but inhibit the growth of the Internet as a commercial platform in the U.S.A.

The newly revised Wire Act has been changed to only prohibit sportsbook type gambling. This means that online poker, online slots, bongo and other games found at the average online casino are now entirely legal. In effect, this new piece of gambling legislation opens the door for local U.S. based online casino operators to start grabbing a share of the online gambling pie.

No doubt one of the reasons behind this sweeping change to U.S. gambling legislation stems from the fact that the U.S. Government has been missing out on a massive amount of tax income, as online casino operators based in the U.S. have been forced to set up offshore holding companies. But what is the proposed effect upon the U.S economy?

Well, for a start, a recent study tells us that we can expect to see over 25,000 new jobs created in the U.S. over the next five years, job that would otherwise have gone to overseas workers. This may not seem like a particularly large figure, but you need to read between the lines here. Online casino operators need far fewer staff than a regular bricks and mortar company. So this 25,000 jobs equates to hundreds of U.S. online casino operators moving back to the country from offshore. This represents billions in tax revenue, as well as injecting much cash into the local U.S. economy.

One thing that we would like to see the U.S. Government do is promote many of America’s ghost towns such as Detroit, as a tax haven for these online casino operators moving back to the country. Not a zero percent tax haven, but possibly a reduced tax rate, this would help these struggling urban areas which currently have more in common with a war zone than a thriving community.

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