Taoiseach's tax gamble
There are few problems that a politician cannot solve with a new tax. Taoiseach Brian Cowen has decided that the racing world's subsidy should be paid for by the betting industry and will legislate this year to tax online and telephone betting.
Cowen said: "the Government will introduce legislation to ensure that overseas betting providers comply with a licensing regime that will permit them to sell their products into our jurisdiction." It sounds very simple, but the implementation will be tricky.
Online gambling is a global industry that booms despite many attempts to ban or regulate it and the danger is that Cowen's proposals will unfairly target those few betting firms that choose to locate in Ireland and create jobs here.
More fundamentally, Cowen has chosen to persist with a link that is both unnecessary and unjustifiable. The Irish horse industry -- a world leader and a huge employer -- needs to be subsidised, but there is no need to tie that funding to the profits of another industry.
The size of the subsidy should be determined by a rigorous examination of the industry's needs and should be tied to performance, not to betting. Whatever cash the government can wring from online gamblers should flow directly into general tax revenue: neither the betting industry nor the horse industry benefit from the link.
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