Regulatory developments in the Republic of Ireland are being followed closely as the bi-party coalition government of Fianna Fáil and Fine Gael are reported to be reviewing the framework of taxes applied to gambling activities.

Ireland’s reform of its gambling industry has closely mirrored its neighbour. The duo are finding common ground in one more area it seems, according to a recent report by The Sunday Times. This common area is tax, with the governments of both Britain and Ireland viewing their respective gambling industries as a potential source of state income.

The Sunday Times’ sources in the Irish government told the paper that authorities are looking at increasing gambling taxes as part of a wider plan to reform how hospitality in the country is taxed.

Ireland’s government wants to cut hospitality VAT to alleviate the impact a forthcoming increase in the minimum wage is going to have on the sector. This would leave a gap in Irish finances, however, one which the government believes could be filled by increasing betting duty from its current rate of 2%.

It is unclear what rate Finance Minister Michael McGrath (Fianna Fáil) has been advised and which governing party seeks a direct increase on gambling taxes.

The Gambling Regulation Bill of Ireland (GRBI) contained no fiscal measures, as the Oireachtas chose to focus on passing legislative reforms needed for Irish authorities to govern gambling, a framework that had not been updated since the 1900s.

In its passage through Oireachtas, ministers noted that GRBI should provide a platform to revise taxes on gambling activities, moving away from a current base rate application.

As part of broader developments, the newly established Gambling Regulatory Authority of Ireland (GRAI) has been assigned the responsibility of designing the ‘Social Impact Levy’ — a dedicated charge on gambling revenues intended to raise funds for the prevention, treatment, and support of gambling addiction.

The context holds similarities with the UK, albeit with a slightly different motive from the government. The Labour administration is in the midst of extensive investment in public infrastructure and other projects, and needs money to fund this.

On top of this, the government is also facing calls – particularly from former Labour Prime Minister Gordon Brown, himself an architect of Britain’s current gambling tax regime – to raise betting duties to pay for a scrapping of the two child limit on child benefits, and other measures to alleviate child poverty in the country.

Gambling funds too alluring

When one looks at the scale of both the Irish and British gambling sectors, it’s not hard to see why the governments in both countries are keen to take a bite out of it. In Ireland, the online gaming sector is expected to grow by 2% to €1.35bn by 2029 and the sector as a whole to hit €1.24bn by the end of 2025, according to IrishCentral.

Over in the UK, the latest figures from the UK Gambling Commission (UKGC) show online gross gambling yield rising 2% year-over-year to £1.49bn between April-June 2025, and although retail GGY did decline during this period also the sector as a whole remains very valuable.

Both markets are also very valuable to some of gambling’s biggest international companies. Flutter Entertainment, which originated in Ireland as Paddy Power before merging with the UK-based Betfair exchange and later acquiring one of Britain’s biggest firms, Sky Bet, has a huge presence across both countries, for example.

Flutter’s Q2 performance in UK&I was, in comparison to previous years, a little lacklustre, only increasing by 1%. Regardless, this figure still stood at US$936m (Q2 2024: $928m), which although dwarfed by American revenue from FanDuel still shows the valuable of British and Irish betting – not just to Flutter but also to some of its competitors like Entain and Evoke.

Ireland’s movements on gambling have been closely mirroring the UK for the past couple of years. While the UK dragged its feet with the two-and-a-half year long review of the 2005 Gambling Act, Ireland passed the GRB in 2024 relatively quickly – although as noted above the country was in dire need of new gambling regulations, with the industry being governed by the Betting Act of 1931, last updated in the 1980s.

This set up a new regulator, the GRAI, which has responsibilities and oversight similar to Britain’s Gambling Commission. The two countries also share similar approaches to player protection, and want companies to take on more responsibility in this area.

Taxation can now be added to the list of similarities, although it can be expected that the Irish betting sector will put up some resistance to tax increases in the same way the British sector has. Horse racing may also follow suit, with British racing having already taken the unprecedented measure of going on strike later this month.

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