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Online betting operators will contribute to reformed horse racing levy, says UK culture secretary


Online betting companies based outside of Britain will be subject to a reformed horse racing levy, the UK government has said.

In response to a question raised by Conservative MP Chris Green in the House of Commons, culture secretary John Whittingdale said that the government intends to "introduce a new funding arrangement for British racing by April 2017".

"We will create a level playing field for British-based and offshore gambling operators, and will ensure a fair return for racing from all bookmakers, including those based offshore," Whittingdale said. "The racing industry will be responsible for making decisions on the spending of the new fund. We will make further announcements shortly."

At the moment the horse race betting levy only applies to betting operators based in Great Britain.

The UK government has the power to introduce regulations that require "bookmakers who are required to hold a remote operating licence" in Britain subject to the horse racing levy under the Gambling (Licensing and Advertising) Act.

"The move to the new licence based system that is due to be in force in April 2017 now looks to incorporate online gamblers who bet on horse racing," said licensing expert Christopher Rees-Gay of Pinsent Masons, the law firm behind Out-Law.com. "Over recent years the increase in the numbers of those that now place bets online has meant a reduction in tax returns from traditional bookmakers. This move is aimed to increase overall tax revenues by taxing account of the ever increasing number of online gamblers who were not previously caught under the old regime."

Whittingdale's announcement was welcomed by the British Horseracing Authority (BHA), the official governing body of British horseracing. Steve Harman chairman of the BHA, said the development was "an important step".

Cabinet Office minister Matt Hancock said that funding for horse racing had been "hampered by an outdated levy system for some time".

"[This] news is a big step forward, and we need to make progress fast in obtaining European clearance and in restoring the yield to sustainable levels soon," Hancock said.

The new measure to replace the existing horse racing levy will require state aid approval by the European Commission before it can be implemented. In June 2013 the Commission approved a French proposal for a "parafiscal levy" on online horse race betting. 

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