As the racing season nears its end for another year, it is a good time to look back on a key piece of legislation that slipped quietly into existence back in the spring, but could have a profound impact on those who love placing bets, whether online or at the track.
At the end of April, a new levy on bookmakers came into force that required them to plough 10% of their profits back into the sport. If you thought this was something that was already in place, the devil is in the detail. It now applies to all bookmakers, whether they are based on track or online, and critically, onshore or overseas.
More online gambling options than ever
The move is an example of that rarest phenomenon – law and regulation reacting to changes in technology, specifically in the form of online casinos and betting sites. The truth is that more than 50 percent of betting on horse races takes place online, and while many such sites are UK based, a large number are not.
With the growing proliferation of online casinos and sports betting websites, users can be at a loss as to which to choose and regulatory bodies can end up losing revenue in taxes and levies. The first problem is a relatively easy one to overcome. Sites such as https://www.casino-ratings.co.uk/ provide a useful rundown of the different options and the pros and cons of each. The second issue was potentially a more complex one, as it required support from the EU in order to enforce the proposed levies.
The EU does not always get the best press, and there was widespread concern at the beginning of the year that it would not play ball and the legislation would face interminable delays. However, to the surprise of many, clearance was received from Europe in April, confirming that as far as EU lawmakers were concerned, the levy is compatible with the appropriate state aid rules.
Good news for the sport
The levy has always been in place for UK bookmakers, but with the rise of online betting and the internet’s disregard for international borders, the sport’s revenue has fallen from £100 million per year ten years ago to just £50 million in 2016.
Conservative estimates from within the industry suggest that is has been missing out on around £30-40 million due to the so-called "offshore loophole."
The increased revenue will be targeted at increasing prize money for the middle and entry levels of the sport, as well as initiatives to protect the welfare of both runners and riders.
Philip Freedman is Chairman of The Horsemen’s Group. He said the news was "fantastic" for everyone involved in British racing. BBC racing pundit Cornelius Lysaght said that the levy provides "much-needed financial stability” for the British horseracing industry.
As the 2017 racing season comes to a close, the only thing remaining is for us to wait with bated breath while the industry completes its final accounts, to find out what change in revenue the new levy has really generated.