The Irish Government is expected to publish draft legislation this week on the taxation of online betting.  The move has long been discussed and was flagged in last December’s Budget.
Betting tax is currently levied at a rate of 1% on all stakes placed in betting shops or over the telephone with bookmakers located in Ireland.  The new legislation will seek to extend this to companies accepting bets online from Ireland.
Similar legislation anticipated in Britain will place a tax on the gross profits achieved by bookmakers but a report in yesterday’s Sunday Business Post suggests this is unlikely for Ireland in the short term.
Ministers have always stated that whatever revenues are derived from betting will be ring fenced for distribution to the horse racing and greyhound racing industries.  Both sports are significant employers and export earners for Ireland and would be deserving of government support as with any high potential sector, even if that ring fencing were to be called into question.
Legislation will have to be cleared within the EU where there is a significant pressure form a number of sports governing bodies to either prohibit betting or to secure a share of the revenues generated where it is legal.
Betting companies are among the largest sporting sponsors across Britain and also have major deals with soccer across Europe, including with Real Madrid, Juventus and a host of top international clubs.
Paddy Power last year signed a major deal to become the official betting partner of Manchester City while Betfair have a similar arrangement with Manchester United.
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