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Gaming analyst: No matter who wins the presidency, taxes are going up

Deutsche Bank gaming analyst Andrew Zarnett has some bad news for voters.

It doesn’t matter if President Barrack Obama is re-elected or Republican challenger Gov. Mitt Romney wins the presidency.

Taxes are going up.

Zarnett, in a research note to investors, said the country is 55 days away from the expiration of the payroll tax cuts and the Bush-era tax cuts.

According to an Oct. 1 report Zarnett cited by the Tax Policy Center, “toppling over the fiscal cliff” would result in a decline of almost $3,500 in discretionary income for approximately 90 percent of all U.S. households. Middle income taxpayers will experience a decline in discretionary income of approximately $2,000 per household.

“This decline in discretionary income will come at a time when everything costs more,” said Zarnett, citing rising transportation costs and higher food prices.

Gaming, Zarnett said, would be negatively affected if the tax cuts are not extended.

Consumers would be left with fewer discretionary dollars in 2013, given tax increases and cost inflation. That would leave fewer dollars for spending on a casino floor, travel and food and beverage expenses.

“While we hope that action will be taken to avert the impact of the entire fiscal cliff, preventing the economy from falling into another recession, we remain cautious,” Zarnett told investors. “We would note that these actions need to be taken in rather short order following the result of the election (in less than two months), amid an extremely divided Congress and country.”

 

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