The proposed introduction of a 2% levy on punters’ winnings in Irish betting shops has received widespread coverage in the mainstream press and racing media over the last few weeks.
However there appears to be a misconception among the general public that Ireland currently has the lowest betting tax in the EU. If we take a closer look at the mechanics behind the Irish taxation system it becomes evident that Irish bookmakers are at a distinct disadvantage relative to their UK counterparts.
The bookmaking sector is being adversely affected by the weak economic situation, the discriminatory betting duty, and the growth of internet betting and gambling. The Irish system of taxation already punishes those bookmakers who are high volume, low margin operators. The more a layer turns over in a year, the more he has to pay. It discourages bookmakers from trying to expand their business. In the UK, the system encourages bookmakers to increase their turnover and thrive, ensuring they can pay staff and retain jobs. The proposal to introduce the 2% tax on winnings in the December Budget has bookmakers in this country up in arms. They are now being hit with a second hammer blow which threatens to close many shops and put operations out of business.