News

Wednesday, March 29, 2006
Call for continuation of levy scheme gets louder

All the fractions of British racing seem to agree that the continuation of the mandatory levy system, according to which bookmakers pay 15% of their profits back to racing through a levy, is the best way forward for the industry. Everyone seems to have come to the conclusion that the financing of racing on the basis of commercizal agreements alone is not possible.

In order for the levy to be kept, the UK government would have to make a turn in its policy, which envisaged a complete stop of government interference in the sector. In an industry conference earlier this week, an industry reform package was presented, which included the following two key elements.

  • The levy would continue for a certain period, after which its functioning will be reviewed;
  • The regulatory and governance functions would be shifted to a single new entity called British Horseracing Authority

    In the immediate future, the regulatory functions of The Jockey Club will already be put in a separate entity, the Horseracing Regulatory Authority.

    What is more difficult to predict is the flow of betting business to foreign based websites, whose operations will become regularised under the new UK gaming law. As tax levels are much lower in many off-shore jurisdictions, foreign betting operators based there will be able to offer better return to punters. A certain flow of betting to these off-shore sites could therefore be anticipated. Will British racing receive funding from these websites at a same level as the domestic levy?