Presidential executive order gives the U.S. gaming industry an opportunity to push jackpot reporting threshold to $5,000, AGA says.
New Presidential Order an Opportunity for Gaming in the U.S.
The American Gaming Association (AGA) has welcomed a new executive order by U.S. President Donald Trump and his administration, in which they propose to target needed regulatory reforms and stimulate job creation and economic growth in the face of the COVID-19 outbreak which has already claimed 20.5 million jobs in April alone.
The casino sector has been one of the worst affected, taking a toll across the board, and shutting down 100% of operations with 989 tribal and commercial casino properties throughout the United States closing.
Now, comprehensive plans for the reopening of the industry have been put forward, and with those, the opportunity to give the industry a chance to pass reforms which it sees as necessary to boost growth in the coming months.
Introduce a More Realistic Jackpot Reporting Threshold
According to AGA president and CEO, Bill Miller, increasing the current $1,200 slot jackpot reporting threshold should be a key priority for the gaming industry. The current rule, Miller noted, dated back to 1997 and had outlived its utility.
It leads to “significant compliance burdens,” both within the gaming industry as well as the Internal Revenue Service, Miller added. He noted that as per current regulation, a winner of a jackpot that exceeds $1,200 needs to fill out a W-2G tax reporting form while the slot is suspended from operation temporarily.
While the jackpot size and inflation have grown, the threshold hasn’t, which opens a lot of paperwork and brings unnecessary downtime on a casino’s floor. Having the gaming industry generate an additional pile of paperwork for the IRS was not an ideal option, Miller said, as a simpler solution was in sight.
Based on the American Gaming Association’s calculations, a more realistic threshold would be $5,000:
“Last year, the AGA again encouraged the Department of Treasury to update the slot jackpot reporting threshold to a realistic level, in-line with inflation, such as $5,000.”
Based on that, the IRS could free up some resources as it wouldn’t have to peruse winnings often hovering close to the $1,200 threshold. Another upside would be the reduction of face-to-face time between casino patrons and casino staff. Minimizing interactions could be even more important in the face of a global pandemic that some suggest may be here to stay.
Global provider of VTLs and gaming products, IGT, has just integrated its cashless payment system with Swedish gaming operator Svenska Spel and specifically for the firm’s brick-and-mortar venues. Miller also said that this policy was long overdue even before the pandemic struck and now, finally, the gaming industry could benefit from this development.
Always on Top of Regulatory Changes
AGA has been particularly vigilant of regulatory changes. Previously, AGA took an issue with the Paycheck Protection Program (PPP) which initially wanted to exclude casino businesses from participating, and then introduced changes that still limited the casino’s ability to receive government help.