More than three-quarters of gambling related to March Madness is illegal, according to the American Gaming Association. But before you opt out of your office bracket pool, keep in mind that few people, if any, are ever prosecuted for gambling on brackets.
“It’s pretty rare for these things to be prosecuted,” Chris Moyer, the director of media relations for the American Gaming Association told the Washington Examiner.
“They are never prosecuted,” Ryan Ellis, an enrolled agent and the tax policy director of Americans for Tax Reform, told the Examiner. “The IRS doesn’t have that kind of bandwidth.”
If a crime is never prosecuted, why make it illegal in the first place?
“There is no tax reason for these pools to be illegal,” Ellis said. “They are illegal due to rent-seeking regulations on the part of casinos. … All voluntary economic activities should, by default, be legal. The burden of proof is on the state to show why not.”
Moyer explained that the American Gaming Association doesn’t necessarily think that office gambling pools should be legalized, but said they don’t have an interest in being the “fun police,” noting that 40 million Americans will fill out a bracket this year in what has become an annual tradition.
Either way, casual sports gambling is not harmful to the economy. The $9 billion to be wagered on March Madness is not deadweight economic loss, it’s a form of entertainment. Most people enter office pools primarily for the fun of competition, with prize money a secondary concern.
Regarding gambling in general, Moyer pointed out that the gaming industry is a “$240 billion industry that supports 1.7 million jobs. It pays $38 billion in taxes.”
Challenger, Gray, & Christmas, Inc. estimates the economy could lose up to $1.9 billion due to lost worker productivity if workers spend too much time filling out their brackets or watching basketball during the workday. Even if that number is accurate, it is less than 0.01 percent of the economy. Challenger said it would be unwise for employers to ban March Madness from their offices, citing the long-term effects on employee morale.
Office bracket pools are technically a crime, but, despite millions of offenders, one would be hard-pressed to find a victim. “No harm, no foul” should apply in both law and basketball.
