It is reported that racing chiefs have rejected a new levy offer from the four major betting shop operators which have so far refused to sign up to the authorised betting partner policy.
Betfred, Coral, Ladbrokes and William Hill are still rejecting the scheme by which operators gain privileges, including the right to sponsor, in return for making a contribution to racing’s finances from offshore online operations which are not currently subject to the domestic levy.
The firms made an offer of five per cent on their remote business last autumn but racing’s rejection of those terms led to the collapse of the levy negotiations. Relations were re-established in February but put on hold again when the UK government announced in March that it planned to replace the levy system in April 2017.
However, last month the four firms in question made a three-year offer to racing consisting of five per cent of their remote gross profits on UK horseracing together with 10.75 per cent from retail in 2016-17, followed by a 7.5 per cent contribution from both remote and from betting shops for the following two years.
Coral had offered to pay 7.5 per cent – the same rate paid by authorised betting partners bet365, Betfair and Sky Bet – through both channels in January but none of those deals have floated the boat of the racing authorities. The ‘rebel’ bookmakers claim their offer would have provided racing with guaranteed income as they cast doubt over the government’s ability to meet the timetable for levy replacement – a report on recommendations is already months overdue – but a showdown now seems inevitable but the ball firmly in the government’s court.
The BHA will be key players in agreeing a settlement that provides satisfaction and a level playing field for all sides but a spokesman insists that the die is cast regarding a long-term and fair replacement for the oft much-maligned levy to reflect modern betting patterns.
Signficantly, the BHA this week announced that it had managed to turn a seven-figure deficit in 2014 into a six-figure profit in 2015. As late as December last year, British racing’s governing body was forecasting it would post another deficit again in 2015 after going from surplus in 2013 to a £1.363 million deficit a year later.
However, costs have been reduced and income has increased while research and development tax credits for 2012, 2013 and 2014 were received from HMRC to boost the coffers.
Last year the governing body made a surplus before tax of £160,000 and after tax of £690,000, the disparity down to the BHA receiving research and development tax credits for 2012, 2013 and 2014 from HMRC.
