Ireland considers hike in betting duty

The Tax Strategy Group has looked at increasing gambling duty to 2.25%.
The Tax Strategy Group has looked at increasing gambling duty to 2.25%.

A group of senior civil servants has considered increasing tax on the industry ahead of the budget for 2021.

Ireland.- The Tax Strategy Group, which comprises senior civil servants and is led by the Department of Finance, has submitted a report that proposes increasing betting duty in Ireland.

Coming ahead of the publication of Ireland’s 2021 budget next month, the report proposes increasing duty from 2 per cent to 2.25 per cent.

It also suggests increasing the quantum of tax relief from €50,000 to €65,000, the Irish Independent has reported.

The group calculated that, assuming betting activity returns to pre-pandemic levels, the hike in duty would bring in an extra €11m a year while the increase in tax relief would reduce that by €1m.

The Department of Finance recognised that the impact of the change would “be almost exclusively borne by large bookmaking firms” and appears unconvinced about an increase in tax relief that would affect few operators.

Under the proposals, the betting duty of a firm with turnover of €25m would be the same as in 2019, it said, but a firm with turnover of €750m would pay more.

Ireland only just hiked its betting duty rate last year, doubling it from 1 per cent to 2 per cent.  

Sharon Byrne, chair of the Irish Bookmakers Association, told the Irish Times that bookmakers were still reeling from that increase and that medium-sized bookmakers would “have no hope of surviving” if faced with a further hike.

She said: “Even for the larger operators, it just wipes out the profitability of the majority of their shops.”

H2 Gambling Capital estimates that the Irish gambling market grew by 26 per cent in the five years up to 2019.

Last year, Irish bettors staked nearly €10bn, up from €8bn in 2018, but H2 predicts the impact of the current pandemic will cause the amount wagered to fall by 21 per cent this year. 

The Tax Strategy Group itself said that betting duty revenue was just €8.1m in July, down from €26.9m last year.

It noted, however, that tax revenue from the first seven months of the year was down by only 4.4 per cent from €61.9m in 2019 to €59.2m this year.

Ireland’s Revenue Commissioners, meanwhile, has warned that it is visiting pubs and bars to check gambling regulations are being enforced.

It recently fined two bars, in Connemara and South Galway, €2,500 each for illegal betting on their premises.

It emerged last week that the creation of a new gambling regulator for Ireland has been put back until at least next year.

In this article:
finance Ireland tax