.svg)
Congressional Republicans have agreed to remove the so-called revenge tax provision from President Donald Trump’s major tax cuts and spending bill, reversing a proposal that had alarmed the U.S. gaming industry.
The Section 899 provision of Trump’s “one, big, beautiful” budget bill would have allowed the U.S. federal government to impose taxes on companies with foreign owners, as well as individuals from countries considered as charging unfair foreign taxes on U.S. companies.
The American Gaming Association (AGA) expressed concern that if Congress had passed the budget reconciliation bill with the provision included, it would have required casinos to identify all patrons as either U.S. or foreign residents as soon as they won a single hand at a table game.
Casinos would also have to report and withhold taxes from the winnings of gamblers from any country with a discriminatory tax.
Senate and House Republicans agreed to remove Section 899 from the budget bill after U.S. Treasury Secretary Scott Bessent said the Trump administration had secured concessions for American businesses from the new Organization for Economic Co-operation and Development (OECD) Pillar 2 global minimum tax regime.
Bessent announced on X on Thursday (June 26) that he had asked lawmakers to remove the Section 899 provision from Trump’s budget bill.
“This understanding with our G7 partners provides greater certainty and stability for the global economy and will enhance growth and investment in the United States and beyond,” Bessent said in his post.
U.S. Senate Finance Committee Chairman Mike Crapo, and House Ways and Means Committee Chairman Jason Smith, both Republicans, said they would duly remove the provision from the bill.
“Congressional Republicans stand ready to take immediate action if the other parties walk away from this deal or slow walk its implementation,” Crapo and Smith said of foreign governments in a joint statement.
Why Section 899 Was A Problem
Under current law, U.S. casinos are not generally required to report or withholding taxes from table games and the winnings of foreign gamblers are blackjack, roulette or baccarat tables in casinos in Las Vegas are elsewhere are exempt from taxation.
As drafted, Section 899 would have significantly affected the revenues that casinos earn from foreign gamblers by requiring withholding on gambling winnings by patrons from those countries identified by the U.S. Department of the Treasury as having discriminatory taxes.
That list of “discriminatory foreign countries” would have been published quarterly.
Major countries like the United Kingdom, France, Australia and India have enacted measures that could have put them in Section 899’s crosshairs, according to a report by the Atlantic Council, a nonpartisan think tank in Washington, D.C.
In a letter sent to Crapo and Smith on Wednesday, the AGA warned that Section 899 would have unintended consequences for table games at casinos across the country.
“Under current law, there is no requirement to identify the U.S. or foreign status of a casino patron in advance of or during play. Any person with cash in hand can walk into a casino and place a wager on a table game,” the AGA wrote. “There is no requirement to solicit identification from such a patron who is playing a table game.”
While slot machines are programmed to lock up once a player wins a jackpot over the reporting threshold, under the Section 899 provisions, casinos would have to identify any table game player as soon as they won and then report on all winnings for identified foreign persons.
The AGA warned lawmakers that the only way to identify a foreign patron in a casino is to ask for identification from every patron, which would “have a very chilling effect on table game play” and result in many customers simply walking away.
“Absent an exception from Section 899 for table games ... U.S. casinos will have to implement processes that will likely destroy all table gaming play for both U.S. and foreign patrons,” the AGA warned.
