BHA urges separate tax for horse racing betting

The BHA said the new tax rate could lead to the industry losing £160 million in income.

The British Horseracing Authority (BHA) has called on the government to consider introducing a separate, lower tax rate for betting on racing to help protect the future of the sport.

The organisation made the plea in its formal response to the Treasury’s consultation on remote gambling duties. Running to 21 July, the consultation covers a proposal to replace three online betting tax rates with a single rate.

Current rates comprise Remote Gaming Duty (RGD), General Betting Duty (GBD) and Pool Betting Duty (PBD). Remote activities face RGD at 21% of operator profit. GBD has a tax at 15% of profit and PBD at 15% of net stake receipts.

The government has not yet said what the rate will be for the so-called Betting & Gaming Duty (BGD). However, several industry members have expressed concerns that the rate could be increased in line with remote gaming duty as all three rates are consolidated.

The BHA is among those opposing the proposal. In its response, the BHA said the new rate would be the third leg of a “triple whammy of financial threats”. Furthermore, it flagged new affordability checks on bettors and a lack of levy reform. Together, it said these could jeopardise the future of racing in Britain.

New rate could cost British racing £160 million a year

According to the BHA, if horse racing was taxed at the same rate as online games of chance, the industry could lose at least £66 million ($76 million) in income each year. In the worst-case scenario, the BHA said this figure could be as high as £160 million.

This, the organisation said, would put thousands of jobs at risk and severely impact towns and communities across the country. It added that this could negatively impact equine welfare in Britain.

As such, the BHA is urging a separate tax rate for racing. It noted that the sector already has a unique tax in the Horserace Betting Levy. Racing’s dependence on revenue from betting is also already recognised in the tax system. The BHA also flagged how the sport is taxed at a lower rate than online games. 

British racing ‘united’ in opposition

The Treasury is due to make a decision on the rate ahead of the next budget, due in October. Ahead of this, the BHA will soon launch an “Axe The Racing Tax” campaign to harness wider support for its proposal.

The BHA said it already has the backing of leading racing stakeholder groups including the Jockey Club, Arena Racing Company, the Racecourse Association, the Racehorse Owners Association and the National Trainers Federation.

“British racing’s stakeholders are united in their opposition to the Treasury’s proposals to harmonise remote gambling duties,” BHA acting CEO Brant Dunshea said.

“Horseracing has a uniquely symbiotic relationship with betting, and the government must recognise this. It is why we are calling for betting on racing to face tax at a different and lower rate to all other forms of betting. 

Dunshea warned jobs in the sector would be heavily impacted, and Britain’s second-largest spectator sport could be in jeopardy.