All betting operators in UK would be required to pay 10% of revenues over £500k
Beginning in April of this year, betting operators in the United Kingdom will have to provide 10% of race wagering revenues to the racing industry. Last Friday, Tracey Crouch, the Minister for Sports, Tourism and Heritage, confirmed that the new rate would be applied to every betting operator, whether they were retail, online, off or on course, spread betting websites or betting exchanges.
The new rate applies to gross gambling revenues over the first £500,000 made by bookies from racing. The new percentage takes the place of the Horserace Betting Levy system which included protracted annual negotiations. Due to the changes, the Levy Board is expected to disband early next year and the UK Gambling Commission will be the group responsible for overseeing the fees. A Racing Authority is set to be created and be in charge of deciding how the money will be distributed within the racing industry.
Word of the 10% rate began back in October and bookies were trying to lobby to see the rate decreased, at least by some degree. It is believed that the fee will create around £90 million for racing each year for a time frame of seven years.The rate will be reviewed again at that time.
Nick Rust, the head of the British Horseracing Authority announced that the fee would restore to racing a return from all betting on the sport at a fair and proportionate rate. The new rate must still be approved by the European Commission to make sure it does not constitute improper state aid. Operators may decide to file an appeal on the matter to the European Court of Justice but this could take some time and would not prevent the new rate from taking place in the meantime.
Operators are not happy with the new rate. Take, for example, Ladbrokes-Coral. They have suggested that the new increase along with other factors could see the sport of horse racing in danger of pricing itself out of friends.
