15 hours ago
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There was perhaps a sigh of relief in the racing world when the Chancellor announced her budget that saw the sport avoid a direct tax hike.
But the British Horseracing Authority (BHA) and other leading bodies must still tread carefully as there was no doubt that rises elsewhere will see the wider gambling industry feel the pinch.
The main issue now is bookmakers have totally shifted the emphasis to the online casino-element of their business so much in recent years that racing faces a knock-on impact.
A reasonable chunk of racing’s finances has been propped up by the cheaper product that guarantees the bookies a bigger profit margin with far less risk and volatility involved.
For too long racing was content to ride that crest of a wave with bookmakers. Now with Remote Gaming Duty (RGD) almost doubling in tax from 21 to 40 per cent, racing no longer has that comfort blanket to fall back on.
The other budget details Rachel Reeves delivered to the gambling industry included an increase of General Betting Duty (GBD) from 15 to 25 per cent – but horse racing will stay on 15 per cent. Betting shops were largely unaffected.
Racing went on strike earlier this year to protest against any potential betting tax increase
September's day of action seemed to have an effect but there is still plenty to be wary of
Big bookmaking firms were hit hard and may scale back on how much they spend on racing
Reeves forecasts the tax rises to earn £1.1billion per year for the Treasury by the end of 2031.
The sport has successfully lobbied the government. In that regard, the ‘Axe The Racing Tax’ initiative has worked for the racing industry. But this is no time to be complacent.
The ball is now in the bookies’ court. They’ll have to review their operation on the account that their most effective product has been whacked significantly. It’ll be very difficult to make online slots and casino products earn a profit of more than 10 per cent after costs and affiliates are taken into consideration.
As this column has previously eluded to a couple of months ago, in forming unexpected partnerships in Parliament, racing may now have to repair their long-standing relationship with bookmakers to a certain extent.
The threats of reduced sponsorship, offering worse prices and higher overrounds are already being played by the bookmaking fraternity. They have been consistent in bemoaning the sheer cost involved to price up and stream racing.
This is the big warning for the sport. Despite a significant tax whammy on the casino and online product, bookmakers could still channel their resources there instead of racing.
This is where the sport needs to attract the interest of bookies again. It must understand their predicament and offer a more slim-line and cost-effective product.
Let’s be honest, the sport has got flabby. We’ve all got lazy on machines. The fixture list needs cut on the account of too many races and too little horses to fill it. A realisation that trim backs are needed when the 2026 media rights renewal comes up for debate.
Racecourses may see less cash come through the new media rights deal next year
Chancellor Rachel Reeves gave racing a reprieve but the gambling sector were not so lucky
A better deal there for bookmakers could throw them enough of a bone to stave off any dramatic short-term cut backs on investment in the sport.
Racing was the undisputed bespoke betting product back in the day. Perhaps with a bit of belief it can be again.
Dramatic races such as yesterday’s Fighting Fifth Hurdle and last year’s Champion Hurdle both won by outsider Golden Ace is the type of race that gets people financially and emotionally invested more than anything else. And, for the record, both results would be enormous wins for bookies online and on the rails.
That is the selling point. Drama can happen at any point, even in the seemingly most perfunctory of races. Handicaps, such as yesterday’s Coral Gold Cup, that had a maximum of 24 runners and held a plethora of possibilities are the kind of events racing should be shouting from the rooftops. It’s too easy to be doom-laden about the sport. It stirs the emotions more than anything else.
There is also another opportunity here for racing. After successfully dodging any ‘Racing Tax’, they know that a collective lobbying approach can work in the corridors of power.
With the gross gambling yield plummeting by another six per cent last year, racing should be pushing for much lighter affordability checks.
After successfully arguing that the sport merits different tax treatment to the online and casino product, racing should be seeking to work with operators to continue the split and seek a better threshold on affordability checks.
Coral Gold Cup winner Panic Attack flies the water jump in a race the sport needs more of
It would free up more money on the sport and, despite poorer prices and greater bookies’ margin which are against the punter, it’s far better than the black market.
The black market is on the rise on all fronts and easing affordability checks might be the issue that racing and bookmakers can unite on in a bid to make the black market less attractive to frustrated and heavily restricted punters. Perhaps, a carve-out deal can be struck there as racing now has a good lobbying voice in government.
A renegotiation to the Levy also seems likely in a few years’ time. Basically, the funding landscape of the sport and the future direction of bookmaking is on the line. It’s all up for grabs.
The Government have had their say via the little red briefcase. It’s now up to racing and bookmakers to react accordingly. If common ground isn’t found then both might find themselves dragged below the water line.
PERFORMANCE OF THE WEEK…
PANIC ATTACK has now won two valuable handicaps on the spin. The Paddy Power Gold Cup winner a few weeks ago repeated the trick at Newbury to win the Coral Gold Cup.
She’s interestingly has an entry for the King George VI Chase at Boxing Day at Kempton. While that’s a significant step up in grade, the Dan Skelton-trained mare continues to improve and three miles plus has unlocked more potential.
She jumped superbly in winning a red-hot 24-runner handicap with conviction at 16-1 and graded assignments surely await. She’s trip versatile and a step back to two and a half for the Mares’ Chase is also an option.
Trainer Gordon Elliott (right) is expected to have a good day at Fairyhouse
SELECTION OF THE DAY…
A good card at Fairyhouse today with some heavyweight clashes and informative graded races. But perhaps the best value on offer is in the Porterstown Handicap Chase and WILL DO (10/1, William Hill) appears to have a reasonable each-way chance.
He’s the pick of Jack Kennedy from the Gordon Elliott yard and can improve from his seasonal reappearance at Navan.
He’s placed in better handicaps in these; such as the National Hunt Chase at Cheltenham and the National trial at Punchestown. A performance like that puts him well in the mix.
