Horse racing levy to be imposed on bookmakers, hitting profits from April

 
Oliver Gill
Follow Oliver
2015 Crabbie's Grand National
Bookmakers must hand over 10 per cent of profits greater than £500,000 under the government's proposed law changes (Source: Getty)

Horse racing organisations rejoiced will bookmakers fumed after the government announced plans to slap a 10 per cent levy of gambling firms.

And bookies won't have much time before get used to the new rules as sports minister Tracey Crouch plans to introduce the levy – which is on all profits greater than £500,000 made on horse racing – in April.

Read more: William Hill shares drop as it reveals £20m profit hit

The British Horseracing Authority (BHA) said the levy would provide a much needed multi-million pound boost to the sport.

Critical

"This is critical to the future health of British racing,” said BHA chief exec Nick Rust, adding the levy would provide a "significant uplift in the sport’s central funding".

“Everyone in British racing would like to extend their thanks to the Minister for Sport, Tourism and Heritage, Tracey Crouch MP, and her dedicated team at the Department for Culture, Media and Sport," he added.

Read more: William Hill merger under threat after largest shareholder pulls support

Meanwhile, bookmakers lamented the news, saying it was yet another cost the sector was going to have to absorbed. William Hill's spokesperson Ciaran O’Brien said:

This follows a decade of significant increases in media rights income from the betting industry.

European block?

There remains hope among gambling firms that the laws could be blocked by European authorities: the government said the levy was subject to sign-off by the European Commission on state aid grounds. This was telling according to O’Brien: “We note the reference to the need for state aid approval given the resulting increase in income to racing from the proposed levy changes."

Read more: Fifa asks bookies to help boost the integrity of the game

There is already a levy in place under laws created in 1961. But offshore gambling firms are under no obligation to pass the levy onto horse racing authorities, although the government said: "Some make voluntary contributions."

"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," said Crouch.

Related articles