Interview: Warwick BartletThe tradition of British Horseracing is legendary across the globe. As one of the oldest and most established sporting institutions in the world, it carries with it an air of dignity, custom and prestige. But what the betting public doesn’t know is that they may soon lose their ability to bet on their favorite jockeys because of a quiet revolt brewing between the Horse Racing Board and the British Bookmakers.
Last year brought a terrible blow to UK Horseracing when the foot and mouth dieses canceled a large proportion of England’s race meetings. That blight not only hit Horse Racing financially, but taught British bookmakers that they could indeed survive without their “sport of kings”. So now that the tracks, trainers, jockeys and owners are ready to get back in full force for 2002, they face yet another battle. The British bookmakers are tired of paying onerous fees to the Horse Racing Board and are demanding a less taxing structure for their right to take bets on British horses.
Gambling Online Magazine approached the Chairman of the BBOA, Warwick Bartlett, and got his opinion on the likely result of this pot that is ready to boil over.
Warwick Bartlett was quick to point out “There are two issues here. The first one is that we currently pay to the horse race betting levy board. We had a negotiation with them taking place in October where we didn’t agree. The matter then went to the Department of Culture, Media and Sport (DCMS) for determination. At the recent BBOA Industry seminar, the minister came and gave the result, which more or less said we have got to give racing ₤90 (approx. $129 million USD) million. That is from April 2002 to April 2003. In the meantime the British Horse Racing Board, on top of that, wants to charge bookmakers for data. That includes the runners, riders, jockeys and all the information you need to put a bet on. From the first of May they want to charge bookmakers one and a half percent of their turnover for that data, and 1% for pictures from the races. That totals 2.5% of bookmaker’s turnover, on top of the existing 17.5% value added tax.
They have said that if we pay the Horse Race Betting Levy Board the ₤90 million we could off set that against the payment to the British Horse Racing Board. For the big three companies, that means they will basically be paying to the BHB what they would be paying to the levy board. But for the smaller bookmakers it’s a tremendous hike in their payments to horse racing. So they are looking at approximately a 400% increase.
But long term the 2.5% rise in rates plus VAT is not sustainable with a nil deduction from the customer. Its simply not sustainable. We would have to make a deduction from the customers who place bets on British Horse Racing to the order of 3%, if other costs are included that could rise to 5%. British Horse Racing, as a product to bet on, is going to become uncompetitive vis-à-vis the rest of the betting market. The punters, in our view, would choose to bet on other products and British Horse Racing would lose its dominance and its importance in the British betting shop.
To complicate the matter, the situation you’ve got with an offshore Bookmaker is that they have to take an internet line from the BHB, and some have chosen to do so. In that case they also pay the BHB, those that try to evade the payment get caught by the BHB’s team of Lawyers, etc. who constantly search the web to find people taking bets on British Horse racing and not paying the BHB. If they are infringing the rights if the BHB, they will sue them and have already announced that they are going to sue Paddy Power in Ireland, for not having signed a contract with them.
So the situation is such that if its uneconomical for small British bookmakers to take Horse bets in this very competitive environment, they won’t. The web has made people look for value, it’s made them look for opportunities to bet where they don’t have to pay betting tax…and why should they pay betting tax when they don’t have to.
The betting exchanges are also coming to the forefront because they are offering additional value to the punter and at the same time it doesn’t appear that the punters are having to pay betting tax at all!
Now that the British punter has now got used to betting tax free, he expects it as his right, and if fee is introduced for betting on British Horse Racing to make up for the bookmaker’s lost revenue, then I think there will be a migration away from Horse Racing to football, golf, NFL or all the other sports.