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Horse Racing Enters New Era As Levy On Bookmakers Comes Into Force

Horse racing on Monday entered a "new era" as a levy on bookmakers came into force, according to the LONDON TIMES. From Tuesday, bookies will have to pay 10% of their gross profits from racing from all betting operators, "whether operating on or off course, on or off shore." The changes mean that the levy "will now include online betting," which accounts for more than 50% of all betting on the sport. By some estimates, the fee -- "designed to replace the Horserace Betting Levy that has funded racing for more than 50 years" -- will cost the bookies £30M ($38.5M) (LONDON TIMES, 4/25). SKY SPORTS reported the current system "had been in existence" since '61 but had "become outdated" and while some offshore firms had been making voluntary contributions toward British racing, "it was not compulsory." New legislation was backed in the House of Commons and House of Lords, with U.K. Sports Minister Tracey Crouch saying that it would "make a profound difference" to the British racing industry. Clearance was received from Europe last week "as to compatibility with state aid rules." British Horseracing Authority CEO Nick Rust said, "Today is a very important day for British racing as the new levy will make a significant contribution to securing the long-term health and growth of our sport" (SKY SPORTS, 4/24).

'FANTASTIC' NEWS: RACING POST's Bill Barber reported racing's leadership "believes the sport has been missing out" on income estimated at £30M-£40M ($51.3M) per year because of the "offshore loophole." However, "not all that amount will be available to spend" as the levy board has been "eating into its reserves as it spent more than it has been receiving from the betting industry." The increased income is set to be targeted at areas like prize money for the "middle and grassroots of the sport," and the welfare of equine and human participants. Horsemen's Group Chair Philip Freedman hailed the news as "fantastic" for all involved in British racing. The news was "also welcomed" by Racecourse Association CEO Stephen Atkin, who said, "Racecourses make a significant contribution to the economy as employers and visitor attractions across the country, and communities the length and breadth of Britain will be key beneficiaries of thriving racecourses supported by crucial levy funding" (RACING POST, 4/25). The BBC's Cornelius Lysaght wrote this provides "some much-needed financial stability for horseracing." An "increasingly precarious situation" has arisen because, while the previous system was able to take into account "traditional" ways of gambling on the horses [which are "generally in sharp decline"], ever-growing online betting, "particularly when operated from offshore bases, were beyond its reach." As of now, everyone that uses British racing as a betting medium "must cough up" (BBC, 4/25).

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