The sweeping new federal tax bill, dubbed the “One Big Beautiful Bill” (OBBB), has caused a stir across the gambling world—generating anxiety for professional players while offering a massive financial boon to Las Vegas’ top casino operators. While MGM Resorts International and Caesars Entertainment brace for potential cash infusions exceeding $100 million each, the industry remains sharply divided over the bill’s impact, particularly a deeply unpopular change to gambling loss deductions.

Executives from MGM and Caesars detailed during recent earnings calls how the bill will significantly reduce their tax liabilities. Caesars CEO Tom Reeg disclosed that the legislation would slash the company’s projected cash tax payments by an estimated $80 million to $100 million. The savings, Reeg said, would counterbalance weaker earnings in the second and third quarters in Las Vegas, according to Covers.

MGM’s Chief Financial Officer Jonathan Halkyard echoed this optimism, noting that the company’s tax outlook had swung from a $100 million liability to a $100 million refund. “It’s a pretty meaningful change,” he stated during MGM’s quarterly presentation.

The bill’s revised tax provisions offer considerable flexibility for these casino giants. With the additional capital, companies could accelerate investments, reduce debt burdens, return value to shareholders, or strengthen their competitive position through acquisitions or technology upgrades.

Windfall for Operators, But Alarm Bells for Gamblers

However, the same law that boosts bottom lines for casino corporations also introduces a major setback for professional gamblers. Starting January 1, 2026, gamblers will only be able to deduct 90% of their losses against winnings—down from the current 100%. The change means that even gamblers who break even on paper could owe taxes on income they never truly realized.

Phil Galfond, a prominent poker professional, labeled the change as “phantom taxation.” Galfond warned: “You would make $200,000 during the year and pay tax as if you made $700,000.” According to Covers, Other well-known voices in the gaming world have expressed similar concerns. Author and poker player Maria Konnikova called the measure “absolutely bonkers,” while another anonymous player highlighted how the new tax math could result in millions in losses even after technically profitable years.

The policy shift, although it affects a minority of gamblers who itemize deductions, is feared to have a ripple effect throughout the gaming ecosystem, which relies on high-stakes players to maintain liquidity and excitement in competitive environments.

Push for Repeal Gains Steam Across Party Lines

The backlash against the loss deduction reduction has sparked a growing bipartisan effort to reverse the change before it takes effect. Representative Dina Titus (D-NV), whose district includes much of the Las Vegas Strip, swiftly introduced legislation to restore the full 100% deduction. So far, her bill has attracted support from ten co-sponsors, including Republicans like Andy Barr of Kentucky, who introduced a parallel bill.

Titus criticized the provision for encouraging movement toward unregulated, untaxed gambling alternatives. “It pushes people into the black market if they don’t do regulated gaming because they have a tax disadvantage,” she said.

In a show of industry solidarity, MGM CEO Bill Hornbuckle, Caesars’ Reeg, and Wynn Resorts CEO Craig Billings met with House Ways and Means Committee Chair Jason Smith (R-MO) in Las Vegas to advocate for restoring the full deduction. Smith later expressed willingness to work toward reinstating the 100% threshold during a public hearing.

Still, challenges remain. An attempt to fast-track the repeal through the Senate was blocked by Senator Todd Young (R-IN), and with Congress in recess until September, lawmakers face a narrow window—just four months—to act before the deduction cap takes effect.

Winners, Losers, and the Road Ahead

Although casino operators cheer many of the bill’s tax code adjustments—such as eliminating income taxes for tipped employees and raising the slot machine reporting threshold from $1,200 to $2,000—those benefits have been overshadowed by the uproar surrounding the loss deduction limit.

“The tax deduction limitation is impactful,” Hornbuckle acknowledged during MGM’s earnings call, adding that it would likely affect VIP and professional players who frequently patronize various casino properties.

Meanwhile, professional gamblers warn the new law could effectively dismantle their livelihood. Financial experts liken the policy to a version of net operating loss limitations, but with even more severe consequences. CPA Joshua Horowitz noted, “They are limiting your losses to 90%, which may cause people to owe tax even in years that they have net losses.”

Despite strong support for change among lawmakers and industry leaders, the OBBB remains a political minefield. The House previously passed a version of the bill without the gambling deduction clause, but the Senate’s revised version—approved with Vice President JD Vance casting the tie-breaking vote—now includes the provision, making it a target for both amendment and repeal as it returns to the House.

Whether Congress manages to reverse course before 2026 or not, the law is poised to have far-reaching implications for both the business of gaming and the professionals who keep its competitive edge alive.