Racing in discussions for return to turnover-based levy

The racing levy could be charged on turnover rather than revenues in a bid to increase returns to the sport following the cap on FOBT stakes, according to new plans being discussed by racing’s leadership.

The turnover model was raised by Racehorse Owners Association president Nicholas Cooper in the group’s annual report for 2017-18.

Cooper said there were “conversations now going on about whether the levy should return to a turnover basis from the current gross profits model”.

He also said there had been some “early discussion” about creating a minimum betting margin to stop bookmakers using racing as a loss-leader to acquire and retain customers.

According to Cooper, a minimum margin could be one way to “close the loophole that often occurs when bookmakers, using racing purely as a marketing tool, bet to a near-zero margin, thereby producing virtually nothing for the levy.”

bet365 in particular has come under criticism for the practice, frequently betting to underrounds on places on major races.

The industry has predicted that a £2 max stake on FOBTs will cause the closure of over 3,500 betting shops, meaning racing’s annual income could fall by £40-60m.

A British Horseracing Authority spokesman told EGR: “Further to the outcome of the gambling review and the Government’s commitment to work with British racing, we have been considering a range of potential options to mitigate any risks to the sport’s income. These considerations remain at an early stage.”

The favoured option to boost levy take is thought to be extending its coverage to international races, meaning revenues from a British customer betitng on an Irish race would be subject to the levy.

BettingExpert racing editor Stephen Haris said the idea of a minimum margin was “short sighted stupidity,” adding: “The future is low margin/high turnover. Giving punters less value just drives them away to other sports.”

Harris said the idea of a turnover-based levy was “more interesting”.