Noonan buckles under bookie pressure.

Dumpthedummy

Heard on the grapevine yesterday that Paddy Power have been strong arming the Department of Finance in relation to the Budget and the possibility of a rise in betting tax. We are about to get crucified next week, we will be paying an additional two per cent VAT on virtually everything, not to mention the other welfare and service cuts and tax rises, but Paddy and the lads are not willing to accept that their business should have a 2% tax on it. Apparently when approached with the tax increase, the boys spat the dummy and said they would move their jobs overseas. This show of loyalty from a company that trades on its Irishness.
The tax used to be 10% and subsequent FF governments reduced it. First from 10% to 5%, then from 5% to 2% and then finally down to 1%. The last cut was made by Biffo, close friend and ally of Paddy Power supremo Paddy Kennedy and then Chairman and current board member Fintan Drury. Brian Lenihan announced in 2009 that he was going to re – raise the tax, before mysteriously changing his mind and bringing it back down in the subsequent finance bill. It may have helped that Paddy Power employed the then Ministers cousin as their tax advisor through PWC.
Fine they are an Irish company and yes they support jobs here, but this is where lobbying crosses the line into something unacceptable. The bookies pay no vat, its internet bets are tax exempt, same with the phone betting. What other industry gets this treatment? Claiming that they cannot afford a 1% tax on an already stupidly low base is nuts. For a company that is always offering money back bets, maybe they could offer a bit back to the rest of us, cos next Monday isn’t gonna be pleasant for the rest of us. We voted FF out to stop this bs, Noonan would want to show some balls.

Guill

We'd be paying a betting tax.

c_man

Apparently when approached with the tax increase, the boys spat the dummy and said they would move their jobs overseas.

They would. There's no question of that at all, it's a valid point.

El Weirdo

Dumpthedummy wrote: »

...its internet bets are tax exempt, same with the phone betting. What other industry gets this treatment?

Is this part of their business not based in the Isle of Man? How are the Irish government supposed to treat them?

kincsem

Betting volume will decline dramatically, except for the "recycling the dole money" betting shop punters.

ThinkAboutIt

Why try and cripple one of the areas in the economy that is doing well?
Might as well be arguing to raise our corporation tax.

ejmaztec

El Weirdo wrote: »

Is this part of their business not based in the Isle of Man? How are the Irish government supposed to treat them?

With contempt, which isn't taxable (at the moment:eek:).

Dumpthedummy

All the Government have to do is make them liable for VAT and it then dosen't matter where in the world they operate,they would pay the fair share of tax in Ireland !

Dumpthedummy

We're already paying a betting tax, at 1% and these guys are spitting the dummy because there is a suggestion that it should go to 2%, hardly crippling since we are all about to face a 23% VAT rate.

Dumpthedummy

I be happy to be crippled with a 2% tax rate,all I suggest is that they pay a fair share, lets face it the rest of us will soon have to pay 23% VAT.

Dumpthedummy

doubling the betting tax would have little effect on Paddy Power, currently worth €2 billion on the stock market.

dxhound2005

Have look at what these guys are paying themselves.

http://www.irishexaminer.com/business/kfojcwkfauau/rss2/

Dumpthedummy

So paying your fair share shouldn't impact their standard of living too much, of course they will also have to suffer the loss of €10 off the Children's allowance along with the rest of us !

Dumpthedummy

When these guys spit the dummy it seems to work for them. You could understand their ability to influence the FF Government, since their Chairman Fintan Drury was best mates with the Taoiseach Brian Cowan, but we now have a change of government and they can still get their way ! Maybe an Oireachtas commitee is needed ?

cloneslad

When the betting tax dropped below 23%, the bookies all decided to take the hit and give the customers their bets on a tax free basis, however, the bookie still pays the going rate of tax, per bet you place.

The tax currently stands at 1%, so for every €10 you are betting, the bookmakers are paying 10cent. They also have to pay further tax on their earnings, their staff pay tax, they pay to lease their buildings, they pay various companies to check, update, repair their software and hardware etc etc, all of this is helping to create further jobs.

It's not like they aren't paying anything at all.

Hi Paddy

*waves

Dumpthedummy

I predicted that the strong arm tactics of Paddy Power and other bookies would result in Minister for Finance Noonan bowing to pressure by cancelling a proposed increase in betting tax from 1% to 2%. This against a background of the higher rate of vat going from 21 to 23%. Well I was right! Today’s Sunday Business Post (Page 3 “Extension to betting tax aims to raise €14 million) has a puff story about the Government aiming to raise an additional €14 million from betting tax – next year. They have bottled out and will leave the current rate of 1% stand in next week’s budget. What a bunch of wimps. The previous Fianna Fail/Coalition Government enacted the legislation to raise the betting tax from 1% to 2% in 2010 and it only needed a Ministerial Order to make it so. Could it have anything to do with the fact that Paddy Power is due to move head office into the constituency of Alan Shatter, or am I too cynical altogether.

Chuck Stone

Isn't the argument that a tax increase on the bookies will just lead to people going offshore and betting online?

So we'd lose jobs in Ireland?

No?

JONJO THE MISER

**** Paddy Power, one of the greatest unreported addictions in this county is gambling and i know quiet a lot of people who's life's it has ruined.
It sickens me the way the media always hype up the bookie moreso paddy power.
On a good note i took them for a good few euro last week on a bet that was a loser but they payed out behind the counter.

bleg

Why not just put extra tax on the lotto? There are plenty of morons who bet on that!

mackg

Noonan buckles under bookie pressure.

What were the odds?

El Weirdo

Dumpthedummy wrote: »

I predicted that the strong arm tactics of Paddy Power and other bookies would result in Minister for Finance Noonan bowing to pressure by cancelling a proposed increase in betting tax from 1% to 2%. This against a background of the higher rate of vat going from 21 to 23%. Well I was right! Today’s Sunday Business Post (Page 3 “Extension to betting tax aims to raise €14 million) has a puff story about the Government aiming to raise an additional €14 million from betting tax – next year. They have bottled out and will leave the current rate of 1% stand in next week’s budget. What a bunch of wimps. The previous Fianna Fail/Coalition Government enacted the legislation to raise the betting tax from 1% to 2% in 2010 and it only needed a Ministerial Order to make it so. Could it have anything to do with the fact that Paddy Power is due to move head office into the constituency of Alan Shatter, or am I too cynical altogether.

Seriously? Are you Ivan fucking Yates or something?

Degag

bleg wrote: »

Why not just put extra tax on the lotto? There are plenty of morons who bet on that!

It's a bit rich calling people who do the lotto twice weekly morons.

JONJO THE MISER

The amount of hardship bookies cause to people, tax on them should be increased to 10-20% and if they dont like it, tough cookie.

Ray Palmer

JONJO THE MISER wrote: »

The amount of hardship bookies cause to people, tax on them should be increased to 10-20% and if they dont like it, tough cookie.

Actually you will find the bookies are not reponsible in any way, it is the people that gamble problems that are the issue. While people like to think of anybody that supplies a product that people get additcted to as pushers the reality is the person with the addiction is the issue.

Addictions where there is no actually bodily dependence are something I find difficult to say are addictions and are more a mental health issue IMHO.

Amirani

JONJO THE MISER wrote: »

The amount of hardship bookies cause to people, tax on them should be increased to 10-20% and if they dont like it, tough cookie.

Yep, because increasing taxation will cause people with addictions to stop gambling...

C-Shore

bleg wrote: »

Why not just put extra tax on the lotto? There are plenty of morons who bet on that!

Do you mean on the cost of the ticket or the gains made by the lottery?

Because I thought the gains come back into the government anyway? Or if you mean to raise tax on a ticket, that would be just the same as raising the base price of the ticket itself..

smokingman

Wasn't the argument that no country in the world has been able to tax online gambling properly without all countries doing it at the same time?
The US banned it and look at all the money that goes through the Bahamas as a result.

If you increase the tax here then the foreign companies that don't employ one person on this island will profit without any taxes going to the Irish government.

...and just for clarity on my own betting habit, I have a PP account but use it for season bets on the F1 season and a few bets on Grand National day.
I usually make money on F1 because I know the sport well and everyone bets on the Grand National so I've not what you could call a "problem"...

Those with problems need help just like alcoholics and drug addicts.

gerryo777

JONJO THE MISER wrote: »

**** Paddy Power, one of the greatest unreported addictions in this county is gambling and i know quiet a lot of people who's life's it has ruined.
It sickens me the way the media always hype up the bookie moreso paddy power.
On a good note i took them for a good few euro last week on a bet that was a loser but they payed out behind the counter.

Has gambling ruined these peoples lives or have these people ruined their own lives by gambling????

Dumpthedummy

Good piece in this morning’s times http://www.irishtimes.com/newspaper/finance/2011/1205/1224308583205.html. UK getting tough on executive pay, Nick Clegg giving out about the unjustifiable salaries of fat cat CEO’s in the private sector, “we now need to get tough on irresponsible behaviour of top remuneration of executives in the private sector”. Back to our friends in Paddy Power on this one. Paddy Kennedy and his fellow board members at Paddy Power paid themselves €6.82 million in remuneration, up by nearly 10% on what they received in 2009. Everyone else was getting their pay cut in this economy, but it seems the old adage is right, you never see a poor bookie. Come on now Paddy Power directors, let’s see you donate some of your “Remuneration” to worthy causes to show you live in the real world. At the very least, stop bullying the Government on the issue of the betting tax.
It’s not too late for the Government to increase the betting levy from 1% to 2%.Even at that higher level, it is less in tax than is paid on children’s shoes and essential medicines.

smokingman

Dumpthedummy wrote: »

It’s not too late for the Government to increase the betting levy from 1% to 2%.Even at that higher level, it is less in tax than is paid on children’s shoes and essential medicines.

So which foreign bookie do you work for then?

Dumpthedummy

I don't !

Orando Broom

bleg wrote: »

Why not just put extra tax on the lotto? There are plenty of morons who bet on that!

The lotto is a tax as opposed a bet.

MagicSean

A tax on bets would be awkward IMHO. It would be easy online but not in a busy shop where people try and put on bets at the last minute. You'd have customers and bookies trying to work out the taxes before placing the bet. Be much easier to tax the winnings.

listermint

MagicSean wrote: »

A tax on bets would be awkward IMHO. It would be easy online but not in a busy shop where people try and put on bets at the last minute. You'd have customers and bookies trying to work out the taxes before placing the bet. Be much easier to tax the winnings.

Eh... wouldnt the till do that???

El Weirdo

MagicSean wrote: »

A tax on bets would be awkward IMHO. It would be easy online but not in a busy shop where people try and put on bets at the last minute. You'd have customers and bookies trying to work out the taxes before placing the bet. Be much easier to tax the winnings.

You've got that arseways. Taxing online is difficult, taxing in the shop is easy- sure it worked fine for years, even before the advent of electronic tills that would work it out automatically.

Besides, you don't have to pay the tax on your stake when you make your bet, you can opt to pay the tax on any winnings. Well, that used to be the case anyway.

etab

I understood if we raised the tax to 2%, people would simply bet online with the Isle of Man guys and thats why they're keeping it here. Is pp even paying the 1%??

hondasam

Should we take bets on the chances of Paddy Power moving his business of out Ireland ?

Orando Broom

MagicSean wrote: »

A tax on bets would be awkward IMHO. It would be easy online but not in a busy shop where people try and put on bets at the last minute. You'd have customers and bookies trying to work out the taxes before placing the bet. Be much easier to tax the winnings.

Bets were taxed here for years. It was 10% and written on the docket. So a £15 bet had a tax od 1.50 and you paid £16:50. The customer knew this. I think it was done away with in '99. I'm not big into gambling so I am open to correction on dates.

Why not raise betting tax in direct proportion to the rise in VAT? Folks here are mentioning VAT is going from 21% to 23% and then suggest that the 1% betting tax be doubled Also a suggestion to make betting subject to VAT :rolleyes: Value added tax on a wager :pac: Are shares subject to VAT?

Folks forget that the margin of profit is quite low in the betting industry.

Orando Broom

If Paddy Power did close all his shops would the loss of jobs not be outweighed by the number of people who are no longer frittering away thier wages on gambling? THe profit margins in Paddy Power would indicate that more people are losing their wages through Paddy Power's 'taxation' of the population than Paddy Power is paying in wages. Cull the few to protect the many.

I think Betting and the horse racing industry in Ireland have had far to high a privilaged position in our society for far too long. It is time they gave much, much more back.

ArmaniJeanss

MagicSean wrote: »

A tax on bets would be awkward IMHO. It would be easy online but not in a busy shop where people try and put on bets at the last minute. You'd have customers and bookies trying to work out the taxes before placing the bet.

Eh, that 'awkward' system already happens. The tax is 1% on all stakes and is calculated by 'the till'.

Should all pubs be closed so too?

ArmaniJeanss

Dumpthedummy wrote: »

It’s not too late for the Government to increase the betting levy from 1% to 2%.Even at that higher level, it is less in tax than is paid on children’s shoes and essential medicines.

This is a common lack of understanding of how the betting system works. When shoes or medicine or food or a pint of beer are bought it is a definitive purchase, the money is gone. So the VAT of 13% or 21% is necessary.

Whereas when 'Mr Average Punter' spends €100 in a bookies on a Saturday morning, he gets a certain amount back which he gambles again.
So €100 staked, €92 returned, €92 staked, €81 returned. €81 staked, €76 returned etc until he goes bust or the shop shuts.
So his initial €100 betting bank covers a multitude of bets all of which are applicable for the 1% tax, so by the end of day his €100 stake can have paid a cumulative tax rate of 10, 20%.

The constant respend of the same money means that what looks like an overly lenient tax regime of 1%/2% is actually rather fair.

ArmaniJeanss

ArmaniJeanss wrote: »

This is a common lack of understanding of how the betting system works........................

Whereas when 'Mr Average Punter' spends €100 in a bookies on a Saturday morning.........................

You're going to get some chap asking what happens when the €100 is put on a loser initially :pac:

MagicSean

El Weirdo wrote: »

You've got that arseways. Taxing online is difficult, taxing in the shop is easy- sure it worked fine for years, even before the advent of electronic tills that would work it out automatically.

Besides, you don't have to pay the tax on your stake when you make your bet, you can opt to pay the tax on any winnings. Well, that used to be the case anyway.

Gambling debts are not enforceable so the bookie can't look for money after the bet has been taken.

Orando Broom wrote: »

Bets were taxed here for years. It was 10% and written on the docket. So a £15 bet had a tax od 1.50 and you paid £16:50. The customer knew this. I think it was done away with in '99. I'm not big into gambling so I am open to correction on dates.

The customer did not always knew. Only the regular customer did.

ArmaniJeanss wrote: »

Eh, that 'awkward' system already happens. The tax is 1% on all stakes and is calculated by 'the till'.

Once the docket is scanned the bet is on the system so if the customer then does not have the tax the bet can't be changed and the bookie is down the money.

ArmaniJeanss

MagicSean wrote: »

Once the docket is scanned the bet is on the system so if the customer then does not have the tax the bet can't be changed and the bookie is down the money.

Its a tax on turnover so once the customer hands over say €10 then 10c is the assumed tax ; the customer doesn't have to physically hand over an extra 10c but he is paying the tax regardless.

MagicSean

MagicSean wrote: »

Gambling debts are not enforceable so the bookie can't look for money after the bet has been taken.



......................



Once the docket is scanned the bet is on the system so if the customer then does not have the tax the bet can't be changed and the bookie is down the money.

If the tax was paid on winnings the bookie deducts it before paying the balance

Secondly, at the moment the bookie pays the tax, if the customer was to pay the tax and claimed they didn't have it they would be treated as slow counters, no cash means no bet taken. Many bookies won't clock in a docket unless the cash is there. And the bet can be changed after scanning it in too

cloneslad

MagicSean wrote: »

Once the docket is scanned the bet is on the system so if the customer then does not have the tax the bet can't be changed and the bookie is down the money.

bets can be voided after they have been scanned. It's just a matter of typing a simple note alongside the bet on the computer, such as 'customer has insufficient funds' and it will be fine.

However this realisitically has to be done before the race is over, as your boss (or the taxman) will look at the time it was voided and the time of the race and think you are trying to steal the money.

starbelgrade

Betting, cigarettes, alcohol etc are all luxury items and should be taxed accordingly.

Rjd2

ThinkAboutIt wrote: »

Why try and cripple one of the areas in the economy that is doing well?
Might as well be arguing to raise our corporation tax.

And an area that actually employs quite a few Iris people..