Saturday was expected to be the "most lucrative day" in the U.K. horseracing calendar, with £200M ($293M) "likely to be staked on the Grand National," according to Malcolm Moore of the FINANCIAL TIMES. But to the "anger of the industry, huge numbers of bets are likely to escape the tax that funds the sport." These bets will come through smartphones, tablets and computers "and be routed to offshore hubs." William Hill said it was likely to take "in excess of a million" bets on its mobile app, with more than 10,000 bets a minute "coming through smartphones and computers in the run-up to the race." British Horseracing Authority CEO Nick Rust, a former Ladbrokes exec, said, "Forty percent of digital bets do not contribute to British racing because they go offshore." He said that the "big four" bookmakers, William Hill, Ladbrokes, Gala Coral and Betfred, did pay a "voluntary contribution" but said it did not "fully reflect the profits they made from online betting." Others, such as Paddy Power and Sky Bet, did not pay a contribution. The feud between racing authorities and the bookmakers over how to support the sport "has been raging for decades." A tax on gambling, called the Horserace Betting Levy, was introduced in the '60s to "compensate racecourses for the money they lost when people place bets off-course, in betting shops." The levy remains in place, charging bookmakers 10.75% of their gross profits for "taking off-course bets." But the racing industry, which also funds itself by "selling media rights," believes that between £20M ($29.2M) and £35M ($51.2M) is "being dodged as bets migrate offshore." The government has said it will "radically change the way the industry raises money by giving it the right to charge all bookmakers" for a license to take bets on the sport, overseen by an industry forum (FT, 4/10).
