Wednesday September 21, 2011 : Minister announces drafting of new tax law
The long-threatened taxation of online gambling in Ireland moved a step closer Wednesday when the minister for justice, Alan Shatter, announced that new gambling laws scheduled for publication early 2012 will bring online operators into the tax net and cap the size and number of casinos.
The move takes advantage of the growing numbers of punters who use the internet to place bets, and seeks to modernise betting laws that date from 1931 and 1956, reports the Reuters news agency.
"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," Shatter said in a statement motivating the new tax.
"The Exchequer is also being short-changed because of the absence of a taxation regime for online and other forms of remote gambling, he added."
Ireland's largest internet gambling operator, Paddy Power, has based its internet operations in the Isle of Man jurisdiction, where a moderate tax regime prevails.
A spokesman for the company, which made almost as much profit through its website and mobile phone applications in the first half of this year as it did overall in the first half of 2010, said it was happy to pay additional taxes as long as they were applied fairly.
"It's the policing of the legalization that is the most important thing. Irish and international players need to be taxed equally," he said.
The law will give the minister for justice full supervisory, inspection and enforcement powers over betting shops and gaming arcades, replacing the current system, which splits the licensing and supervision between the minister for justice and the minister for finance.
The legalization will permit moderately sized land casinos but not large, resort-style operations.
Although Shatter did not reveal any detail on the new tax, there has been speculation that government will be empowered to include a levy to support treatment facilities for problem gamblers, but such a provision would only be activated if funds established by the operators themselves for such facilities were inadequate, Reuters notes.