The companies that are typically paying out the jackpots in Las Vegas may have just hit one of their own, thanks to the One Big Beautiful Bill (OBBB).
The recent passage of the new business tax bill could turn into a windfall for major casino operators like MGM and Caesars.
Thanks to various tax provisions in the law, these companies expect to see a significant reduction in their cash taxes amounting to $80 to $100 million. In simpler terms, they will be saving a lot of money that was initially anticipated to go toward taxes.
How Would the One Big Beautiful Bill Benefit Companies Like MGM and Caesars?
The extra money could come in handy in many ways. Here are just a few:
1. Increased Capital for Investment
With less money going into taxes, MGM and Caesars could have more funds available for investment.
This could mean expanding their properties, renovating existing ones, or even venturing into new markets both in the U.S. and abroad. An injection of capital like this can lead to more business activities and possibly more jobs.
2. Debt Reduction and Improved Credit
The extra cash flow could also be used to pay down debt.
By reducing their debt, MGM and Caesars can lower their interest expenses. This could also lead to better leverage ratios, improving their credit scores and enabling more favorable borrowing conditions in the future.
3. Returns to Shareholders
Holding onto extra cash isn't always the best strategy for big companies.
MGM’s CFO has mentioned that a portion of this newfound cash flow could potentially be returned to shareholders. This might happen in the form of share buybacks or increased dividends, ultimately making shareholders happier.
4. Strategic Flexibility
Having easy access to more funds gives MGM and Caesars the agility to navigate uncertain economic times more comfortably. Whether responding to market changes or pursuing new acquisitions, this surplus cash provides them with strategic flexibility.
5. Competitive Positioning
With extra cash, the companies can make investments in areas that enhance their competitive advantage, such as customer loyalty programs, amenities, or technology upgrades. These improvements could put them ahead of their rivals in the industry.
With the increased free cash flow, MGM and Caesars could be set up to explore mergers, acquisitions, or partnerships that align with their growth strategies. This could further strengthen their market position and offer new growth paths.
One Big Beautiful Bill Includes Changes for Gamblers
While these changes bring substantial benefits to casino operators, the One Big Beautiful Bill contains a potential downside for professional gamblers.
Starting in 2026, gamblers will only be able to deduct 90% of their losses against winnings, down from the previous 100%. For professional gamblers, this means paying more taxes even if they only break even, which has sparked controversy.
According to Adam Hoffer, director of excise tax policy at the Tax Foundation, this change particularly impacts professional gamblers who could find themselves paying more taxes each year. This small alteration in tax deductibility could have significant implications for many in the gambling community.
Pushback Against One Big Beautiful Bill Far From Over
Democratic Representative Dina Titus, from Nevada, has introduced a new bill.
Her bill would restore the previous rule allowing gamblers to deduct 100% of their losses — a standard that was changed after the last major tax bill passed. So far, it has gained support from 10 other lawmakers from both the Democratic and Republican parties. Republican Representative Andy Barr from Kentucky introduced a similar bill.
Even though this idea has support from both sides, it's still uncertain if it will pass. An attempt to quickly approve the bill in the Senate was blocked. For the bill to become law, it will need approval from both the Senate and the House of Representatives.
The House of Representatives is not scheduled to resume its regular activities (post summer break) until September. This will leave lawmakers roughly four months to overturn the 90% deduction before it becomes effective on January 1, 2026.
This rule change is just one of many potential changes being talked about in a Congress that is closely divided between the two parties.
Key Issues Still Unresolved Ahead of January 2026
The recent tax law changes bring a promising outlook for casino giants like MGM and Caesars, with substantial tax savings opening up numerous possibilities for investment and growth.
However, not everyone benefits equally under the new rules.
The bill could make things harder financially for professional gamblers, which shows how complicated tax laws can be and how they affect different groups of people in different ways.
