Betting Magazine BETTING Magazine numero 23 del 24 marzo 2015 | Page 4

BETTING

N° 23 - 24 Marzo 2015

Magazine

4

Gaming UK

Budget confirms
UK horserace
betting right
The Department for Culture Media and Sport’s consultation into a horserace betting right only closed on
12 March 2015 but just a week later the Chancellor
George Osborne used his Budget speech today (18
March 2015) to say «in the week after Cheltenham
[Festival] we will support the British racing industry by introducing a horserace betting right».
The Chancellor said nothing more about the mechanics of the betting
right in his speech and supporting Budget documentation was light on
specific details too. It simply stated:
Horserace Betting Right – The government will bring forward legislative proposals to replace the 1963 Horserace Betting Levy with a
new Horserace Betting Right. The new authorisation scheme will
apply to all bookmakers, wherever located, who take bets from
British customers on British racing and will be administered directly
by the racing industry.
Analysis in the February 2015 consultation document, however, considered the impact of three rates of betting right: 10.75% (the current
Levy amount), a central case of 30% and a high case of 50%.
When the consultation was first published, GBGC outlined its thoughts
on the proposals:
The Government has become tired of the current arrangements run
through the Horserace Betting Levy Board. If the annual negotiations
over the amount of Levy to be paid fail because the two sides – bookmakers and racing – do not agree, then ministers are called upon to
determine the result. The politicians’ fear is that whatever decision they
make they will upset one or both sides and please no one.
The Department for Culture Media and Sport (DCMS) is also concerned
at the amount of leakage in the current system. Offshore operators do
not pay Levy, they (the bookmakers) argue that many of their customers
that bet on various horse race meetings around the world should not be
liable to pay levy in a country where they do not live. Racing will argue
to the contrary – if you have the pleasure of betting on a sport you
should help pay for the cost to run it.
In an attempt to be reasonable the big bookmakers have already made
offers to Government and racing to pay the levy at 10.75% for their offshore business. It is an offer that has not been taken up by racing. One
can only presume that they are of the view that 10.75% of gross win is
not enough or it would give licence to free loaders. Either way racing
must be in a reasonably comfortable position to be able to refuse the
offer or has been assured that to do so would undermine its position
on “right to bet” where they feel confident of success.

For bookmakers, paying 30% plus of gross profits to
racing plus 15% gross profits tax and the rising cost
of media rights makes horse racing uneconomic as a
betting proposition.
Some may choose not to take the product, some may
choose to take the product but pass the liability on to the customer. Will
the customer pay? Doubtful – he has been weaned on Internet betting
where the payouts are high. Will he choose to desert racing and bet on
another product?
I suspect that the consultation paper has been heavily influenced by the
racing lobby. The emphasis is that racing will act reasonably in negotiation because it is in their interests to do so and that bookmakers need
the racing product. The po