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Rahm Emanuel has a new funding idea. He wants Washington to tax online betting and prediction platforms and send that money into U.S. research.
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Instead of treating online betting and prediction markets only as gambling policy issues, Rahm Emanuel wants to turn them into a funding source. Under his proposal, all bets placed at licensed online sportsbooks and online casino apps, along with all contract purchases on prediction platforms, would face a 10% federal transaction charge, according to Bloomberg.
Emanuel said the idea is about competition with China as much as tax policy. He argued that the U.S. needs an innovation fund at a time when federal support for research has been cut back. He said:
“I’m talking about a specific innovation fund that keeps America beating China rather than going to second place against China. And that’s how you sell this.”
He put the expected revenue at $30 billion to $50 billion. Money from the plan would go to artificial intelligence, national security technology, cancer research, life sciences, fusion energy, and quantum computing.
A second part of his argument targets recent cuts in academic research support. The Associated Press reported that from January to May 2025, the Trump administration cut $11 billion from universities across the country, including Harvard, Penn, Columbia, Cornell, Northwestern, Brown, and UCLA. Emanuel tied those cuts to a wider U.S. risk in the race with China.
The tax plan would need federal legislation, and key details are still unclear. It is not known whether the charge would apply to gross revenue, net revenue, total handle, or each individual transaction.
Emanuel has not entered the 2028 presidential race, though he is often mentioned as a possible Democratic contender. He said the proposal is not mainly about a campaign. “While that may be a side benefit, I’m more interested in the American people getting ahead and America staying ahead,” he said in an interview.
He has also framed the charge as new federal revenue rather than a replacement for current funding. He compared it with taxes on products like alcohol and tobacco. At the same time, he has pushed Democrats to offer a more specific agenda, and parts of that agenda are starting to take shape around research funding, industrial policy, and tighter rules for gambling and prediction platforms.
He made that case even more directly in remarks cited by the Chicago Sun-Times. “We’re stagnant and worse than stagnant under President Trump,” he said, according to the Chicago Sun-Times. “We’re cutting the NIH [National Institutes of Health] and the National Science Foundation,” Emanuel said. “To me, raise a 10% fee. It goes into this Innovation Fund. I’m tired of people betting against America. I want to bet on America. I want to not reward gambling. I want to actually reward the entrepreneur.”
His position on the sector already goes beyond taxation. Earlier, he said federal employees should be barred from using prediction platforms because of insider trading risks and conflicts of interest. He also said betting and prediction companies would likely fight back against a plan that adds more taxes to what he called a $400 billion industry.