In the region of €25m will be raised annually by a new online betting tax that Michael Noonan has been trying to introduce since he became minister for finance more than three years ago.
The levy on online transactions will seek to target foreign-based bookmakers that provide remote services to Irish customers.
Around €1.6bn per year is gambled in Ireland online, with most of the profits going to overseas enterprises that enjoy a relatively tax- free regime here in a manner akin to the ‘double Irish’ scheme used by American multinationals.
Up to €11m of the money raised will go towards capital and other investment in Ireland’s horse and greyhound racing industries.
The long-awaited enactment of the Betting (Amendment) Bill 2013 is imminent and will require remote bookmakers and betting exchanges providing betting services to punters to obtain a licence in Ireland, regardless of whether or not they have any physical presence in this country.
They will also be liable to pay tax on betting transactions with Irish customers.
Some of the money raised from the new tax will be ring-fenced to aid the Irish bloodstock industry, said Mr Noonan.
“In recognition of the importance of the Irish bloodstock industry to the rural economy and the anticipated yield of €25m per annum from betting duty, the Government will be providing an additional €6m a year for three years to the fund for horse and greyhound racing,” he told the Dáil.
“The Government is also allocating additional capital of €5m to Horse Racing Ireland in 2015 to leverage investment in race courses.”
The bill is designed to provide a regulatory system for remote bookmakers and betting intermediaries — otherwise known as betting exchanges — offering betting services in Ireland regardless of their location. It also seeks to provide for a fair and equal treatment of all bookmakers, traditional and remote, and betting exchanges offering services in Ireland.
Paddy Power bookmakers yesterday gave a broad welcome to the enactment of the bill.
“We have worked closely with the authorities in Ireland on the Betting (Amendment) Bill — ensuring that there is a level playing pitch for all companies who operate in the Irish marketplace irrespective of whether they are based in Ireland or not,” a company spokesman said.
Attempts to tax online betting have been going on at government level since at least 2009 when former justice minister Dermot Ahern began a review of gambling legislation, some of which dated from 1931.
In his very first Finance Act as finance minister in 2011, Mr Noonan provided for a new licensing regime and an extension of the betting tax to online gambling but it is only now coming into force.
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