What's happened
Starting in 2026, US taxpayers can only deduct 90% of gambling losses against winnings, a change embedded in a new tax law signed by President Trump. This will cause some gamblers to owe taxes even when breaking even or losing money. The provision has sparked bipartisan pushback, with lawmakers seeking to restore full deductions. Meanwhile, Oman announced a 5% personal income tax for high earners, effective 2028, marking the Gulf's first such levy.
What's behind the headline?
Impact on Gamblers and Industry
The 10% cap on gambling loss deductions will impose tax liabilities on gamblers who previously broke even or lost money, effectively taxing net losses. This disproportionately affects professional gamblers and high-volume recreational players, potentially threatening the viability of professional gambling careers in the US.
Legislative Dynamics
The provision was inserted late in the Senate Finance Committee's 900-page tax bill, catching many lawmakers by surprise. The swift passage limited debate, prompting bipartisan efforts to repeal or amend the rule. Senator Cortez Masto's push for unanimous consent failed due to Republican objections, indicating partisan negotiation complexities.
Economic and Fiscal Considerations
The provision is projected to generate $1.1 billion over eight years, contributing to a broader $3.3 trillion deficit increase from 2025-2034. Republicans defend the change as a necessary procedural step tied to budget reconciliation.
Broader Regional Tax Trends
Oman's introduction of a personal income tax for high earners marks a historic shift in the Gulf, traditionally tax-free for individuals. This move reflects fiscal diversification efforts amid volatile oil markets and may signal future GCC tax reforms.
Forecast
The US gambling provision will likely face continued legislative challenges and public pushback, with potential for partial repeal or modification. Oman's tax law implementation will test regional acceptance of direct personal taxation, possibly influencing neighboring Gulf states' fiscal policies.
What the papers say
The AP News detailed Senator Catherine Cortez Masto's failed attempt to restore full gambling loss deductions, highlighting Senator Todd Young's objection and the bipartisan bills introduced to reverse the change. It quoted Senator Ron Wyden criticizing the rushed legislative process. The Independent emphasized concerns from gambling professionals and industry experts like accountant Russell Fox, who warned the change could harm the casino industry long-term. Poker player Phil Galfond's social media warnings about the tax burden on gamblers were cited. The New York Post provided concrete examples of tax liabilities under the new rule, quoting professionals like Zachary Zimbile and Doug Polk, who called the provision a career killer for professional gamblers. Bloomberg succinctly summarized the legislative change. On the Oman tax front, Gulf News and The New Arab reported on the historic introduction of a 5% personal income tax for high earners starting in 2028, including exemptions and social considerations. AP News quoted Oman's Minister of Economy Said bin Mohammed Al-Saqri on the tax's role in diversifying revenue and reducing oil dependence. Gulf News offered analysis on regional tax trends and the cautious approach of GCC countries toward personal income tax. Together, these sources illustrate a global trend toward fiscal diversification amid economic pressures, with the US and Oman taking distinct but significant steps in tax policy reform.
How we got here
The US tax overhaul, signed in late June 2025, included a provision limiting gambling loss deductions to 90% of winnings starting 2026, aiming to raise over $1 billion in revenue. This change affects professional and high-volume gamblers. Separately, Oman enacted its first personal income tax law, imposing a 5% tax on individuals earning above OMR 42,000 (~$109,000) from 2028, to diversify revenue away from oil dependence.
Go deeper
- How will the new gambling tax deduction limit affect professional gamblers?
- What are the arguments for and against the 90% deduction cap?
- How does Oman's new personal income tax compare to other Gulf countries?
Common question
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Why is Oman Introducing a Personal Income Tax?
Oman's decision to implement a personal income tax starting January 2028 marks a significant shift in its economic policy. This move raises questions about the motivations behind the tax, its impact on the population, and how it compares to tax systems in other Gulf countries. Below, we explore these questions and more.
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What is Oman's New Personal Income Tax Law?
Oman has introduced its first Personal Income Tax Law, set to take effect in 2028. This significant change raises many questions about its implications for citizens and the economy. Here are some common queries regarding this new tax law.
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How Will Oman's New Personal Income Tax Affect Residents and the Economy?
Oman has introduced its first Personal Income Tax Law, set to take effect on January 1, 2028. This landmark decision is expected to impact high earners and the broader economy significantly. Here are some common questions about the implications of this new tax law.
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How Will Recent US and Oman Tax Changes Impact You?
Recent tax reforms in the US and Oman are reshaping the financial landscape. From new limits on gambling deductions to Oman’s introduction of a high-earner income tax, these changes raise important questions for taxpayers, investors, and professionals alike. Curious about how these policies might affect your finances or investment strategies? Read on to find clear answers to your most pressing questions.
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