California Assemblyman Adam Gray\u2019s bill to scrap gambling-loss tax deductions is likely to be contested hard by his old foes, the tribal casinos. Native American operators have previously stood in the way of his efforts to legalize online poker and sports betting. (Image: mercedsunstar.com)<\/figcaption><\/figure>\nUnder current federal and state law, gamblers can claim deductions on gambling losses, provided these are itemized on tax returns and do not exceed the amount of income from gambling reported.<\/p>\n
But Gray believes the law is a \u201csin subsidy for the rich,\u201d mainly benefiting wealthy customers at California\u2019s tribal casinos. He wants an estimated $300 million deducted by gamblers each year to be diverted into programs that ensure Californians have healthy drinking water.<\/p>\n
Gray is sponsoring a bill called the Inland California Healthy Communities Act that would close what he describes as a \u201cloophole\u201d that \u201cbenefits fewer than 150,000 people, primarily millionaires and billionaires.\u201d<\/p>\n
If Congress wants to pay to subsidize gamblers that\u2019s their business, but we have families in California who cannot safely drink the water in their homes or get in to see a doctor,\u201d Gray explained.<\/p><\/blockquote>\n
Of course, the bill only covers state taxes paid by California residents. Federal gambling tax-reporting regulations, to which California currently conforms, would remain in place.<\/p>\n