New Zealand’s coalition government is concerned about the island country’s ailing horse racing industry, and plans to do something about it. Among the measures it will introduce are new taxes on offshore bookmakers, and a new governance structure for the sector.
According to reports, Winston Peters, who is both deputy prime minister and the minister of racing, said the industry’s decline was serious, and that it needed to be reformed. The legislation he is set to introduce hopefully will achieve this, as it is in keeping with the review made by John Messara, a racing expert from Australia. Peters said he believed the industry would once again reach its potential, as the country had not only the space in which to do it, but the horses and the people as well.
One of the reforms planned to take effect by 1 July this year is the introduction of new taxes, among which are race course fees and a point of consumption levy. The move is intended to offer short-term improvement to the industry’s finances.
The fees will be levied on operators that use sport and race data from the country. While a rate has yet to be decided upon, the document submitted by Peters indicated that as much as NZ$24 million could be raised for horse racing in New Zealand by a little as a 2% turnover tax.
The industry currently is governed by the New Zealand Racing Board, but this will not the case for much longer. The board is set to be replaced by the Racing Industry Transitional Authority, which is tasked with developing the structure that will eventually take over governing the sector.
In addition to managing the transformation of the industry, the authority also will take over the board’s current functions.
Despite its plan to impose the point of consumption tax on all online bookmakers that accept punters from New Zealand, the government has no intention of issuing licenses. According to Peters’ policy paper, the introduction of licenses would be the end of the board’s monopoly
The government’s dogged refusal to issue operating licenses has been a contentious issue for a long time, and the planned new taxes are likely to intensify it. Those critical of the planned tax changes, such as ESSA, have argued that it is unfair to tax companies that cannot obtain licenses. They also argued that more licensed operators would mean fewer players would get involved in illegal gambling.
However, as though to make up for the fact that it will not license other operators, the legislation changes will allow the board to offer betting on other sports to players in New Zealand.