There was a great deal of excitement when George Osborne first announced that the Budget would include a Racing Right in place of the Levy system, which came into form as a result of the Betting Levy Act of 1961.
There has been a lot of lobbying for the Racing Right and the British Horseracing Authority has been at the forefront to call for it.
The Levy system has been very unpopular and various governments have suggested replacements for it without actually doing anything.
This system is very outdated and it hasn’t been able to keep pace with the changes in technology that permit people to gamble online.
Osborne’s statements on the issue of horse racing have brought hope to the industry because it means that the sport will become more profitable than present.
Many people believe that the Levy has kept bookmakers under control whereas nothing could be further from the truth.
Bookmaking shops may be empty, but the biggest bookies are very much in business, except that they have relocated to offshore destinations.
As of now, most of the money is made by offshore bookmakers and this means that revenues are not reaching where they are intended.
As a matter of fact, bookmakers based in destinations such as Gibraltar benefit from the tremendous interest in racing without even having to contribute to the Levy.
There’s not a lot of understanding about how the introduction of a Racing Right will benefit gamblers and the public at large.
In fact, a public opinion campaign has been underway for a while, designed to pressurise ministers from introducing the Racing Right.
At present, the entire burden of the Levy is borne by bookmakers who have remained onshore.
It is very reasonable to expect everyone who benefits from horse racing in England to contribute to the Levy irrespective of where the business is located.
If this is not done immediately, then English horse racing will slowly, but eventually choke to death.
The Royal Ascot is without doubt one of the premier horse racing events in the world, but many of the horses that race in it are from abroad. Even now, the event derives much of its sponsorship from abroad.
The English can easily copy a page from the French play book on racing. The French government charges 5.6% of the turnover of online gambling operations.
This leaves an excellent opportunity for the English government to generate much needed revenues from racing.
Even the Irish government has amended its laws to ensure that Irish Racing benefits from the taxes raised from offshore bookmakers.
Horse racing is different from other sports in that its main audience comprises of gamblers.
It is a widely acknowledged fact that it depends very much on the revenues generated from gambling.
The government needs to deliver on its promise of bringing the tax system up to date before the sport becomes completely unviable for English horse owners.
It remains to be seen whether the government will finally deliver on its pre-election talk.