There Will Be No Betting Taxation Hike in Ireland in 2018Published December 31, 2017 by Ivan P
The Ministry of Finance of Ireland decided that none of the three new proposed taxation models would be beneficial at this point in time.
Bookies and their customers in Ireland can breathe a sigh of relief as it was confirmed that the broadly discussed proposal to raise taxes on betting in 2018 was rejected by the Irish Finance Minster Paschal Donohoe. The finance department was looking into several different options to try and raise around €50 million from the betting industry, but it seems none of these plans will be implemented in 2018.
1% Tax Stays in Place
Right now, betting operators in Ireland are taxed at 1% on their yearly revenues and this will not change at least for another year. Mr. Donohoe stated that his department may revisit proposed tax hikes in 2019.
The current taxation rate is among the lowest in Europe and there were several proposals to change this and raise taxes by at least one percentage point. The hike would result in some €50 million of additional revenue infused into the country's budget.
Proposed Changes Could Affect Bettors
Although the Department of Finance decided to leave things as they are for the time being, it is likely there will be some changes to the betting taxation system in Ireland in 2019 or beyond. When and if they decide it is time for the hike, the government will probably choose one of the three proposals.
The first one, as mentioned, calls for the taxation rate to be doubled, enacting a 2% rate for all betting operators serving Irish customers. The second proposal would change the current system completely, taxing operators based on their gross profits instead of yearly revenues.
The third and final proposal that found its way to the table of Minister Donohoe suggests taxing bettors instead of bookies. Although no exact details were revealed, it is safe to assume this is the least preferred option from the players' point of view.
No Good Solution
The main reason why the government decided to skip on the taxation hike in 2018 is the fact none of these three proposals seems fitting. Doubling the taxation rate could adversely influence the industry and cause bookies to close down or reduce the number of employees. Taxing bettors could cause them to turn to unregulated sites, which would hardly benefit anyone.
The idea to tax bookies based on their yearly profits seems to make most sense, but it also requires a lot of preparatory work. Hence, the current 1% taxation model will stay in place for at least another year, which is good news for bookies and their customers alike.