A heated debate erupted during the New York Senate Standing Committee on Budget and Revenue meeting on May 28, 2025, as lawmakers discussed a controversial bill regarding the taxation of gambling winnings. The proposal aims to align state tax laws with federal regulations, which have changed significantly since the Tax Cuts and Jobs Act (TCJA) of 2017.

Senator Connery voiced strong opposition, arguing that the bill would unfairly tax individuals on gambling winnings without allowing them to deduct their losses. "You're gonna have a situation where people are gonna be paying tax on money that they may not have anymore," he warned, highlighting the potential financial burden on casual gamblers who might win small amounts but lose it all shortly after. He emphasized that the current federal tax code allows individuals to offset their gambling losses against their winnings, a practice that would be eliminated under the proposed legislation.

In response, proponents of the bill defended its intent, stating that it seeks to eliminate what they view as a subsidy for gambling. They argued that the bill would bring New York in line with federal standards and reduce the incentive for individuals to gamble excessively. "We don't think that we should be subsidizing people who are gambling," one senator remarked, reinforcing the rationale behind the proposed changes.

The discussion also touched on the broader implications for the state's gambling industry, with concerns raised about the potential impact on casinos struggling to attract patrons. Senators expressed a desire to ensure that New York remains competitive with neighboring states that offer more favorable gambling regulations.

Ultimately, the committee decided to advance the bill for further review, acknowledging the need for additional study on its potential effects. As the debate continues, the future of gambling taxation in New York remains uncertain, with lawmakers weighing the balance between revenue generation and fair treatment of taxpayers.