Thousands of jobs in the betting industry are threatened because of moves into the Irish market by offshore tax free betting operators, according to Irish Independent Betting Offices Association (IIBOA).

It has called on the Minister for Finance, Mr McCreevy, to reduce betting tax from 10 per cent to 5 per cent, to allow bookmakers compete more effectively.

The organisation, which represents 300 independent bookmakers, says there is a crisis in the industry with 3,500 jobs threatened by the new competition.

The offshore operators, many of them based in the Isle of Man, are able to undercut Irish bookmakers by offering bets with a 10 per cent reduction.

Unlike bets placed in the Republic which carry a 10 per cent tax, offshore betting involves virtually no tax.

Many of the offshore operators offer bets on the National Lottery and GAA/FAI matches and target "non-UK citizens". The IIBOA says independent bookmakers do not have the resources to establish offshore operations.

It says that when betting tax was reduced to 10 per cent in 1985 there was an immediate 44 per cent increase in off-course turnover.

"The recent decision to extend opening hours of betting offices in the evenings coupled with a new 5 per cent tax rate will become self-financing over a short period and contribute to growth and job creation in the sector," said spokesman, Mr Brian O'Farrell.

He added that the reduction in betting tax would also "curb the outflow of betting funds to lower betting tax regions".