Bookmakers who take bets on British horse races from UK gamblers may have to pay as much as a 10 per cent levy on their profits if new government plans come to fruition.
From April betting firms, including those offshore, will be charged the levy to support UK horse racing. The reforms will replace the current system, which required only UK-based operators to pay, and it’s not going down well with those bookmakers based offshore. Many, based primarily in Gibraltar and Malta, may have to look again at their decision to relocate the core of their business to the Mediterranean – and that could be bad news for local job prospects abroad!
British sports minister Tracey Crouch said the move would make sure that gambling firms pay a fair return to British racing. Bookmakers continue to argue that plans will be difficult to implement, however, as bets are taken across a wide-spectrum of sports and othere events. Distinguishing how much income is generated solely by betting on racing would be a logistical nightmare as amounts would also need to be distinguished from bets struck on French or US racing, for example, which are exempt from planned legislation. There are certainly complex legal issues to resolve and the cut-off date in April will be almost impossible to meet.
Bookmakers have in the past threatened legal action over plans to extend the levy and the Association of British Bookmakers, which represents high street betting shops, said it was concerned about the cumulative impact of media rights, tax and regulations, though any talk of a legal challenge was premature. Sadly, the question of levy contributions from the betting industry, which is a major sponsor of horse racing, has been a bone of contention for more years than anyone cares to remember.
The current system has been in existence since 1961 but is badly in need of reform to meet modern demands. Some offshore firms have been making voluntary contributions towards British racing but it is not compulsory and the British Horse Racing Authority has long took the view that bookmakers are getting their product on the cheap. The latest reforms, first announced in March 2016, do come after long periods of consultation and the BHA believe that expansion of the levy is critical to the future health of British racing. They are already blocking race and racecourse sponsorship by bookmakers who refuse to contribute significantly to the current levy and this is impacting the sport with some major players not on the list of the BHA’s approved partners.
Big-hitters William Hill and Ladbrokes are notable absentees but it remains to be seen who blinks first now that the UK government is actively involved.
