New online gambling tax rules have been sent to Ireland’s president to be signed into law according to Irish Finance Minister Michael Noonan.
Noonan has been pushing for an online gambling tax for three years.
The new online betting tax could help raise $ 27.5 million a year. The tax would apply to foreign-based bookmakers that offer remote services to customers in Ireland. The country does not currently tax these operators.
The law will be introduced via the enactment of the Betting Amendment Bill 2013. Reuters reports that the new rules will come into force once operators that are already licensed in another jurisdiction are granted licenses in Ireland.
The Irish finance department said it expects operators to begin paying tax by the middle of this year.
A plan to tax foreign online bookmakers serving Irish customers was originally proposed in 2011, but it was never put into effect. At the time, the proposal called for the government collect a one percent tax on all bets made in betting shops, as well as bets made on the internet and by telephone.
Online bookmakers such as Paddy Power, Ladbrokes, and William Hill would be affected. The proposed tax first saw light in 2011, in which Ireland sought to bring online and phone wagering into the mix with a 1 percent tax on those wagers made bet shops.
Legislation on the matter has seen several delays over the past couple of years, but will commence once the operators gain licenses to provide betting services in Ireland. Operators are expected to pay the tax by the middle of the year according to a spokeswoman for the finance department.
Paddy Power, Ireland’s largest bookmaker, said the tax would have cost it $8.8 million last year. For 2014, its profit before tax was $179 million. The company also said its effective tax rate would skyrocket from 13 percent into the high teens.
