The government is considering an increase to the gambling tax, while also taking steps to safeguard smaller betting businesses from an impact on their earnings. At present, a 2 per cent tax is imposed on all bets placed either online or offline within the country, which isn’t passed onto the gamblers. This taxation method garnered €103 million last year.
In the past, tax from betting was allocated to support horse and greyhound racing, however, this link was severed during the financial crisis of 2008. The allocation for these sports currently stands at €95 million annually.
The Department of Finance Tax Strategy Group released a report on Tuesday, indicating an exploration of a 0.5 per cent increase to the betting charge. Furthermore, the group is considering raising the current allowance to €65,000 per annum, up from €50,000, to alleviate the strain on smaller bookmakers. Such businesses usually see a yearly turnover fewer than €2.5 million.
However, the report highlighted concerns from Revenue that this step might necessitate approval for EU state aid, as it would realistically serve the interest of a limited number of entities.
The Irish gambling market is primarily controlled by three companies; Paddy Power, a subsidiary of New York-listed Flutter Entertainment, Ladbrokes, a part of UK group Entain, and Boylesports. The report states that, overwhelmingly, the gambling duty is paid by a small number of large firms.
The strategy group also observed a declining trend of problem gambling between 2014 and 2022, as per the Health Research Board. That said, the issue persists, afflicting around 135,000 individuals, particularly prevalent amongst those residing in deprived areas, or those struggling with substance misuse.
The Oireachtas is on the brink of passing legislation to establish a Gambling Regulator with measures aimed at protecting underage and vulnerable individuals.
Last year, the duty on betting and a 25 per cent levy on commission earned by betting intermediaries in the tax law accounted for €102.7 million. So far, this year has seen a collection of nearly €52 million. In 2019, the government had doubled the tax on betting.
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