The British government will abolish off-course betting tax from the beginning of 2002 in a bid to help high street bookmakers compete with offshore and internet-based rivals.
The British Chancellor, Gordon Brown, scrapped the current system in which the Government collect a betting duty of 6.75 per cent from bookmakers which is passed on to punters in a 9 per cent tax.
Many British bookmaker shops have struggled as the industry fights off the threat posed by offshore competitors who offer tax-free bets, and internet bookies who provide low-tax betting.
Here, the paddypower.comwebsite has facilitated many British punters as they can avoid paying tax on their bets by wagering online.
Stewart Kenny, managing director of Paddy Power said today's announcement was "a move that had to be welcomed by bookmakers and bettors alike."
"Anything that reduces the burden on the customer is good news and this Government has now set a course towards tax-free betting," he explained.
Kenny added: "Gordon Brown’s announcement will have a positive affect on turnover and activity. . .it will make the UK a very attractive base for betting operations."
It is the first time since 1968 that British betting shop customers will be able to place a bet without a percentage going to government.
In 1999, Minister for Finance Charlie McCreevy abolished betting tax for on-course Irish bookmakers and reduced off-course betting shops tax levels from 10 per cent to 5 per cent.