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HORSERACING LEVY ROW RUMBLES ON
Posted 1/7/11 : It looks as if the Minister will have to make the call
Reports in The Financial Times and in Leisure Management suggest that the horseracing and bookie sectors are still poles apart on the vexed question of the racing levy, with both parties rejecting a compromise proposal put forward by the government of GBP75-80 million.
The amount of the annual horse racing subsidy from the bookmaking companies to the horse racing industry has been the cause of a long-running and at times acrimonious dispute which may only be resolved by ministerial intervention, it appears.
The Financial Times reports that the levy has fallen to GBP65 million - a drop of two thirds - in recent times, and that the horse racing industry is demanding between GBP130 million and GBP150 million this year.
Opposing this are the bookmaking companies who foot the subsidy, claiming that no more than GBP50 million would be a fair number, because they already pay GBP50 million in to racing for television rights.
The impasse makes it likely that the government's Culture Secretary, Jeremy Hunt, will have to make the call, with a decision that could come in February.
It is not just the amount of the levy that is in dispute; proposals to remove thresholds in place to protect small betting shops have also alarmed the bookmakers, and triggered warnings that this could result in the loss of more than 400 independent operators and 2,000 jobs in the UK.
Racing industry representatives favour the removal of the threshold, and want to apply the levy to bets on non-British racing.
“There is a real danger of owners walking away from the sport completely, with major owners . . . having the option of transferring sizable strings of racehorses out of Britain,” the racing industry’s submission warned.
“The viability of many trainers’ businesses is being called into question, and significant changes to breeders’ behaviour could have damaging and irreversible effects on our sport.”
Bookmakers Committee chairman Will Roseff says: "The Levy is no longer fit for purpose. Racing is a thriving sport that no longer needs to rely on a subsidy from the 1960s. Nothing would demonstrate clearer progress towards its abolition than a refusal by the Secretary of State to increase the levels of this outdated subsidy."
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