Irish Government to cut down bookie taxes

Published by Daniel on July 26, 2019 in Industry News

Irish Bookie Tax CutsThe past year has been one filled with many victories and gambling regulation changes in many regions.  

When it comes to the gambling industry there are always new changes being implemented affecting players or operators.  

Bookies operating in Ireland could soon be breathing a little easier with tax breaks being considered.  

Heavy taxes sink small players 

The Irish Government is considering making a cut to betting duty and by doing so will allow bookies a tax-free turnover of €2.5 million per year.

The reason behind the bookie tax breaks considered is to help smaller players within the gambling market. This after the Minister of Finance, Paschal Donohoe, doubled betting tax to 2% of turnover earlier this year.  

Donohoe raised betting tax after heavy lobbying from horse racing and breeding industries. They complained that their business was the lifeline of online and high street bookies.  

The rise in taxes was met with stark criticism from the Irish Bookmakers Association who claimed it is putting smaller, independent operators out of business. As a result the policy is to be reviewed in its entirety and it is suggested that the tax levy should only apply to turnover over €2.5 million. 

According to calculations done by tax strategy groups introducing the €2.5 million a year threshold would cut the turnover tax to 1% for anyone with a €5 million annual turnover. It would leave it a 1.99% for big firms who receive more than €750 million in bets per year. According to the report the new threshold could cut the collected betting tax by €3.4 million. 

While bookies only paid €52.3 million in tax during 2018 they have already paid €34.7 million in tax by May this year.  

Tax increase considered for online operators 

Another proposal considered by the Department of Finance was for online operators to pay twice the amount of tax that is paid by traditional, Highstreet bookies. This proposal was thrown out shortly after being considered by the Irish Bookmakers Association as there were concerns about breaching EU state-aid rules. With these rules governments are banned from supporting businesses in a way that could misrepresent the competition.  

Gambling Problems 

The Irish Government passed legislation in 2001 which linked betting tax with state support for horse and dog racing. According to the tax strategy group’s report, the bets were taxed to account for the social costs of problem gambling. The report claimed that there is evidence suggesting that 8 out of 1000 Irish people have some form of gambling problem. 

It is unclear how the government will choose to address the issue as problem gambling has become a very serious problem. It is a primary focus across the globe and many operators and regulators have been tasked with finding ways to target and help these problem gamblers.  

The Irish Government could soon be invoking new rules or steps to stop problem gamblers from accessing any kind of gambling activities. It is a serious condition that needs to be treated and stopped.