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New Levy On Bookmakers To Double Funding For U.K. Racing To $108M

Racing "received another financial boost" on Friday with the announcement of a "new levy on retail bookmakers" of 10% of their gross profits from the sport, according to Mark Souster of the LONDON TIMES. For "the first time that figure includes bets made online and offshore, not only in shops." This "significant development will mean that, from April, racing should receive" about £90M ($108.1M) per year from the tax, "almost double what it gets at present." The figure is in place for at least the next seven years, "giving those running the sport the bonus of certainty and an ability to plan long-term." The "old levy was renegotiated every year." The new legislation was announced by U.K. Sports Minister Tracey Crouch and ends a "long-running and increasingly acrimonious stand-off between racing and the bookmakers over the rate they should pay." Racing’s income from high street bookmakers had "fallen dramatically" from a peak of £100M about eight years ago because bets made offshore "escaped the previous levy," which stood at 10.75%. There has been a "marked migration of punters and a change in betting habits over this period," with a "growing trend" toward gambling via mobile phones. Crouch: "This move will help secure the future of horse racing in Britain by making sure that gambling firms pay a fair return to support the sport." The government intends to transfer responsibility for collecting the levy to the Gambling Commission in early '18. Funding will then be distributed, via the commission, to a nominated racing authority, "which will be responsible for deciding how that money is spent." Bookmakers were "less enamored." While they "accepted the principle of a tax on offshore bets, they had argued for a lower rate and one that reflected the extra costs the industry pays in media rights" (LONDON TIMES, 1/14).

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