Ireland’s Minister of Finance Michael Noonan published the country’s long-awaited Betting (Amendment) Bill 2012 last week. The legislation creates a new licensing and tax system that ensures all bookmakers operating in the country hold an Irish gambling license and are taxed equally.
The legislative change to the Betting Act 1931 requires Irish-based and offshore bookmakers that turnover more than €200,000 in Ireland or earn over 10 percent of revenue online, to obtain a ‘remote bookmaker’s license.’ Betting exchanges operating in the country now require a ‘remote betting intermediary’s license.’
“The fact that offshore bookmakers were not subject to the betting levy represented a competitive disadvantage to onshore firms and also narrowed the State’s yield from the levy,” remarked Noonan.
Under terms drafted in the 2011 Finance Act, licenses will cost €5,000 for operators to purchase and renew. Online operators are required to pay a 1 percent betting tax. Betting exchanges are subject to a 15 percent gross profit tax. This ensures all bookmakers operating in Ireland are paying an equal amount of tax.
“This bill will bring into place a fair and equitable licensing and regulatory regime for all bookmakers and betting intermediaries,” said Noonan, explaining that the legislation has been designed to “ensure a fair and equal treatment of all bookmakers and betting exchanges offering services in Ireland.”
In an attempt to prevent crime and maintain customer protection in Ireland, the legislation is supported by an enforcement structure. Operators can be fined up to €150,000 and issued prison terms for failure to comply with the new law.
“The shortcomings in the current law, for example the absence of any regulation of online gambling, are exposing young people and other vulnerable persons to unacceptable risks,” added Alan Shatter, Irish Minister for Justice, Equality and Defence, “The Exchequer is also being short changed because of the absence of a taxation regime for online and other forms of remote gambling.”
Establishing the Irish legislative system could provide a basis for offshore companies to operate in the country under the new regulatory framework, which has not been updated since the Gaming and Lotteries Act of 1956. Developments throughout Europe have led to the industry to look for properly governed jurisdictions.
The amended bill now goes to a vote by Irish lawmakers, after which the draft will be referred to the European Commission for approval before becoming law. The process is expected to be finalised in early 2013.
The Minister stated, “The series of decisions taken by the government will bring clarity and certainty. This will assist anyone planning to locate business here. They can be assured they will be operating within a comprehensive, modern regime.”