Ireland Uses Threat of Online Casino Ban to Blackmail Operators

To persuade Internet gambling operators to accept a tax to fund animal racing, Minister Martin Cullen says the alternative may be a ban like the UIGEA.

Irish legislators are tired of subsidizing the local horse and dog racing industries, so the Minister of Sport proposes that online casinos carry the burden. To persuade Internet gambling operators to accept a tax to fund animal racing, Minister Martin Cullen says the alternative may be a ban like the UIGEA.

The Irish government will spend over $100 million keeping the racing business afloat. The number was reduced by less than $3 million from the original budget after threats of major cuts, but Cullen says the days of government support are coming to an end, and he expects online gambling sites that take money out of Ireland to bear the weight.

"The big players will need to come to the plate. A view will need to be formed about Internet and offshore betting," said Cullen. "I will use whatever legal levers are available to me to get at that funding in terms of trying to get some tax out of it."

Cullen says that over $2.5 billion is wagered online or overseas by Irish gamblers annually, and he wants some of that back.

But Internet casino operators say Irish racing is already subsidized far heavier than in other countries, even while most gambling on animal racing in Ireland involves racing across the Irish Channel, in Great Britain.

Paddy Power released a statement questioning what has happened to the almost $1 billion the local racing providers have already received? If only sixteen percent of racing wagers are on local races, why, a spokesman asked, are politicians so eager to keep money flowing to the local industry?

The answer may be to keep the rich getting richer. A small group of foreign citizens and exiles who established overseas residence to avoid Irish taxes control almost all prize money generated by Irish racing, the end destination for over half of all subsidies.

According to the Independent of Ireland, exactly eight owners, with residences in such tax havens as Monaco and Barbados, took over a third of all racing prize money. Meanwhile, racing subsidization accounts for a third of the Ministry of Sports' entire budget, and the Irish Sports Council, funding sixty-plus leagues and the national athletic development program, gets $10 million less than racing.