Best Case Scenario in 5-10 Years?

[cuserounder]

After all the legislation has gone through Congress, and let's assume (I know, huge assumption - but for this discussion...) that the US government regulates online poker. What's our best case scenario? The government is going to get a huge chunk, and US companies running these sites may feel they have a corner on the market and bump up the rake.

I could see it being 10% rake to the house, 5% to the government.. Or worse. There's been talk of automatic tax witholding from each table you play, or each day, or each cash out.. Obviously per cash out is pretty reasonable, per table is a nightmare.

So what's the best case? I'll lay out a couple of options:

1.
No licensing fee for the right to have an online poker room, 5% of each pot to the house 2-3% to the government. Taxes are withheld each time you cash out above your initial deposit. So essentially the only change is you have to pay taxes and 2-3% per pot.

2.
There is a hefty licensing fee, and then the government doesn't worry about getting a cut of each pot.. Taxes are withheld each time you cash out.

Either of these realistic? Will it be better or worse?

[Carlson411]

SH&(. Right now I'll take anything, but as long as I still get to keep playing poker on the internet.

[Richas]

The UK tax rate is going to be 15% of gross profit. This compares pretty well to the cut taken by affiliates.

Poker sites are hugely cash generative, having regulation and a tax on them is far more likely to lead to a squeeze on their margins (very high now) than a rise in the rake for player given a competitive marketplace.

The innaugral WSOP in London organised by Harrah's kicks off in early Sept, just as a legal site could launch. Harrahs can make money with competitive rakes and pay the tax.

Best case scenario for 5-10 - a regulated industry in both the US and EU.

[NickMPK]

I can't imagine that the US government would implement a tax by raking each pot. Should online poker ever be regulated, it will probably mostly be a tax on corporate profits, with a (perhaps nominal) licensing fee.

[nineinchal]

[ QUOTE ]
I could see it being 10% rake to the house, 5% to the government.. Or worse.

Either of these realistic? Will it be better or worse?

[/ QUOTE ]

It ain't gonna happen. Excessive rakes will insure that internet poker goes underground. There is greater incentive for the sites offer lower rakes if they are outlaw and don't have to share with the government. If the government wants to regulate it, they will have to accept lower percentages. Otherwise internet poker will be bootlegged right to your modem.

[Orlando Salazar]

I think modest rake increases as sites pay operator fees is probable. I also believe transaction monitoring will be the biggest part to "protect the underage/degens" and collect tax on cashout profit.

[dlk9s]

I wouldn't mind at all if withholding was taken out of my winnings (and I hope I will have winnings). If I'm going to pay taxes anyway, might as well have it taken care of for me.

[KipBond]

[ QUOTE ]
US companies running these sites may feel they have a corner on the market and bump up the rake.

[/ QUOTE ]

As long as there are minimal barriers to entry, the market will take care of that. If there are enough people playing, the rake should actually go down. Heh, I could actually see a site that has no rake, and is supported by advertisements. /images/graemlins/laugh.gif

[schlucky1]

[ QUOTE ]


Best case scenario for 5-10 - a regulated industry in both the US and EU.

[/ QUOTE ]

The thought of this almost makes my penis move. We would see a new, unprecidented, golden age of poker. I'm staying optimistic.

[Grasshopp3r]

Within 5 to 10 years? That is a long time to predict for the interwebs.

I remember 10 years ago and the web was really just getting rolling. Here are some bold, futurama predictions for 10 years out:

Currency: There will be a standard internet currency that is based upon an inflation neutral standard. Most international trade will be denominated in this currency.

Security: Biometric security will be DNA based.

Gaming: Government regulated sites will not exist or will not be cost competitive with rogue sites. We will be able to reach the rogue sites with any internet connection. The With complete worldwide access to the gaming markets, the poker market will be over 1 billion players per day. It is currently under a couple hundred thousand players per day.

Internet: I predict that governments will lose control of the internet. All sorts of direct international trading will occur.

[TreyWilly]

[ QUOTE ]
Poker sites are hugely cash generative, having regulation and a tax on them is far more likely to lead to a squeeze on their margins (very high now) than a rise in the rake for player given a competitive marketplace.

[/ QUOTE ]

QFT.

I don't see why this isn't clear to everyone. How much do you think a bag of weed would cost at the corner store if the government regulated and taxed marijuana? Even with obscene taxes, it would be substantially less than it is now on the street.

[jschaud]

[ QUOTE ]
[ QUOTE ]
US companies running these sites may feel they have a corner on the market and bump up the rake.

[/ QUOTE ]

As long as there are minimal barriers to entry, the market will take care of that. If there are enough people playing, the rake should actually go down. Heh, I could actually see a site that has no rake, and is supported by their sportsbook.:D

[/ QUOTE ]

fyp

[Grasshopp3r]

Imagine the pharmaceutical industry and agribusiness combining to grow the best drugs for the world? They could flood the market and drive the drug dealers out of business.

[TreyWilly]

[ QUOTE ]
Imagine the pharmaceutical industry and agribusiness combining to grow the best drugs for the world? They could flood the market and drive the drug dealers out of business.

[/ QUOTE ]

I doubt anyone would care if the drug dealers were out of business, as long as there was open competition between the super growers.

[jschaud]

[ QUOTE ]
Within 5 to 10 years? That is a long time to predict for the interwebs.

I remember 10 years ago and the web was really just getting rolling. Here are some bold, futurama predictions for 10 years out:

Currency: There will be a standard internet currency that is based upon an inflation neutral standard. Most international trade will be denominated in this currency.


[/ QUOTE ]

http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=55595

sounds about right

[Reef]

Hopefully bots don't kill the games (like online chess / backgammon)

[Grasshopp3r]

[ QUOTE ]
[ QUOTE ]
Within 5 to 10 years? That is a long time to predict for the interwebs.

I remember 10 years ago and the web was really just getting rolling. Here are some bold, futurama predictions for 10 years out:

Currency: There will be a standard internet currency that is based upon an inflation neutral standard. Most international trade will be denominated in this currency.


[/ QUOTE ]

http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=55595

sounds about right

[/ QUOTE ]

I was thinking more along the lines of egold http://www.e-gold.com/