TAX ON online betting will be introduced for the first time under the Finance Bill and online bookmakers will have to pay a licence fee to operate in Ireland.

However, Minister for Finance Brian Lenihan ruled out a Fine Gael call to increase the minimum operating licence fee for bookies from €5,000 to €50,000. He said they had to be mindful of operators within the EU and charges should not be “disproportionate”.

Brian Hayes (FG, Dublin South West) said seven of the 10 providers in Ireland “have their server outside the State”.

Those placing a bet online would have to pay a 1 per cent turnover tax but Mr Hayes said it would be a “difficult task” for the Minister to determine the 1 per cent turnover because the companies were based outside the State.

A €50,000 fee would “raise revenue”.

“For some fly-by-night operators in existence outside this State who offer services to citizens of this State, it would set an important financial threshold that they would have to obtain were they to get a licence to operate in this country, and that would be significant.

“If they did not have the €50,000 upfront they should not be registered or have a licence here. Many of these operators, be they in Gibraltar, Gambia, will simply put on their websites that they have been fully recognised by the Irish State as an operator in this country for a licence fee of €5,000. We are underselling ourselves.”

Mr Lenihan said Mr Hayes mentioned “Gambia and other exotic locations”, but some were in the EU. “We must be conscious of the various freedoms that apply within the union” and a high licence fee could be see as restrictive.

He said that “a licence fee of €5,000 for a company that may take only a handful of small bets from Ireland could be deemed onerous”.