How is online gambling different in the US and Canada?

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The USA and Canada don’t just share the same continent. Their cultures, traditions, even their affection towards sports and games of luck are similar. Thus, online gambling falls in this basket, too.

But the shared enthusiasm for online gambling isn’t enough to say that these two countries are equals in this field. What drives the knife in and cuts them apart are their laws. The US and Canada are federations with both federal and state/provincial gambling laws; however – they differ drastically.

Namely, Canada doesn’t allow hosting an online gambling site but has no problem with offshore betting or playing online games. And the US regards it quite the opposite.

So what do these two neighbors have in common, and where do they part ways when it comes to online gambling? Read on to discover how online gambling is different in the US and Canada.

The Legality of Online Gambling

One of the most researched questions is whether online gambling is legal in the US. This can be considered a tricky question considering the number of Acts passed which regulate this matter.

One of the more famous ones is the Wire Act from 1961, which banned certain types of gambling. However, because it didn’t expressly prohibit online gambling, in 2011, it was decided that this extends only to sports betting. This ultimately made it possible for states to individually make a decision on the legalization of gambling.

Today, the US allows online gambling. Or better said, the federal law legalized online gambling but left the details to the states. So, if you’re thinking of gambling through the Internet in the US, you first have to check what the state gambling law allows and prohibits.

Another thing to remember is that although online gambling is legal inside the US, that isn’t the case for offshore web gambling!

On the other hand, there is Canada and its laws. The legal hierarchy is the same but yields different results. In other words, online gambling inside Canada is prohibited, but the act itself is not. This means that you can place bets or play online games in any offshore web casino.

The reason for this is that the Government of Canada doesn’t issue licenses which makes gambling on its territory legal. But, there is a slight catch here!

Kahnawake – a Mohawk territory in Canada, established the Kahnawake Gaming Commission, which licenses gambling on Mohawk territory. Considering that this is a sovereign territory, best online casinos Canada players can access are based right here.

Online Casino – a Yay or a Nay

In Canada, you can gamble in online casinos from any province. However, in the US, there are states that prohibit gambling in an online casino. Here is a list of  states where online casinos are legal:

• Nevada,
• Delaware,
• New Jersey,
• Connecticut,
• Pennsylvania (joined 2017),
• West Virginia (joined 2019),
• Michigan (joined 2021).

Online Sportsbooks – To Bet or Not to Bet

Online sportsbooks are different but they are worth to be mentioned here, mainly because of their effect on the online gambling industry.

As an example, we can consider Canada. There are some different rules from those applied to online casinos. In 2021, single-game sports betting became legal in this country and this is a huge step for the whole online gambling world in the Great White North.

South of the border, however, the USA, has been regulating online sports betting since 2018.

Tax Law – The Turning Point

Here is where things go in totally opposite ways.

The Great White North has zero-taxation tied to any winnings you make on online gambling. So, if you win a million, lucky you – you get to keep it! This is what happened in 2015 when a lucky Canadian won around CA$7.5 million on a progressive slot jackpot.

But in the US, things are a little different. There is a flat 25% taxation on any winnings you make. You can even make as little as $1, but you will still have to pay the tax. There is an option to get the reduction given only to those that take gambling as their main source of income.

Yet, this requires filling out other forms and is a potential basis for other taxes.

Game Providers

Provided that Canada allows its players to enjoy only offshore online gambling, it’s safe to say that Canadians enjoy every game provider on the market. They are not tied to the laws in Canada, so regardless of being European, Asian, or other developers, Canadian gamblers are free to choose!

In the US, we have a different story. Namely, only Scientific Games, Betsoft, and Real-Time Gaming (RTG) are licensed to place their games in the US, and this narrows the circle for US players.

Still, on the plus side, things have been changing recently. Some states like Nevada or New Jersey have introduced other international game developers, which opens the doors for many more in the future.

Payment Methods

The US and Canada both have the same payment methods for withdrawals and deposits. You can use Skrill, Neteller, Interac, Visa, MasterCard, cryptocurrencies, or any other method you prefer.

When it comes to currencies, the US has an advantage seeing that the dollar is vastly used – internally and in offshore casinos!

Bonus Variations

Promos are offered because of the big market competition. So having this in mind, it’s clear why Canadians have better chances to get a bigger bonus than US residents. It doesn’t mean that there are no big bonuses in the USA, but simply online casinos can agree better around them since the market is limited.

Conclusion

These are the main differences and some similarities between the US and Canadian online gambling markets. Both of them have their strengths and weaknesses.

Some might think that Canada is better off without any laws and should stay in its current position. However, having your country’s laws back you up in any potential fraud or other problem is a major win for the US.

Nonetheless, both countries are working toward clearing all obstacles on their paths. So we are sure that Canada will regulate this matter in the near future, and the US will open its doors to international gambling casinos.