There was some bad news for Paddy Power Betfair as they suffered a loss of £250m from the value of the FTSE 100 this week. The big market reaction came after it was announced that the Irish Government plan to double the betting duties in the country.
The Irish turnover tax is set to go up from 1pc to 2pc in the new changes and this applies to both retail and online bets from new year. There will also be an increase from 15pc to 25pc on gambling exchanges as well.
There has been a big fear that the huge rise in tax responsibilities will go a long way to “kill the industry”.
Paddy Power Betfair are the largest of the Irish operators and they have estimated that under the new tax regime, their annual betting duty bill will go up by a staggering £20m which sparked the drop in their shares by 5pc.
Other major players like Ladbrokes Coral, GVC and William Hill have nowhere near as large of a footprint in Ireland so won’t be as heavily affected.
The Irish Bookmakers Association Chairman Sharon Byrne said it will “kill the industry”, adding: “It is extremely disappointing that the Government conceded to this demand by politicians who never engaged with the industry or understood the profound effect a turnover tax can have on so many jobs.”
The IBA also warned that the announcement by Finance minister Paschal Donohoe “just signed P45s for over 1,500 jobs in the independent bookmaking sector”.
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