Offshore Gambling and the Horseracing Levy

Simon Hart Excerpts

Wednesday 13th July 2011 Commons Chamber

[Matthew Hancock]

My hon. Friend makes an important contribution. Prize money is critical to the sport and its future, but it has fallen by almost a half in just the last two years. Also, betting duty—the tax that the Exchequer takes—has fallen from £420 million to £340 million, so it, too, is on the decline. I am a low-tax Tory, but I do not think that we were talking about that.

[Simon Hart (Carmarthen West and South Pembrokeshire) (Con)]

What my hon. Friend is suggesting sounds like a good idea, but—he will have to forgive my ignorance here—can he assure me that it will not have an adverse effect on point-to-point racing, which is also a major contributor to local economies and provides great enjoyment to those who do not go to major race meetings?

[Matthew Hancock]

Absolutely, because almost all betting on point-to-point racing is on-course, and one cannot be both offshore and on-course at the same time. Point-to-point racing is a critical part of local and, especially, rural livelihoods. I know that my hon. Friend the Member for Hexham (Guy Opperman) would also like me to make the same point in his absence. He cannot be here because he is recovering from a serious illness, but he is an experienced point-to-point rider.

The levy, prize money and tax revenues are all falling sharply. Why is this? Over the past few years, more and more betting companies have moved offshore. Only two of our 19 biggest bookmakers are now onshore for tax and levy purposes. The previous Government did a deal with the gambling industry—they would not put the levy up, and in return the bookies would stay onshore—but the bookies have gone. I can understand their reason, because once one competitor has moved offshore and does not pay tax or the levy, the competitive pressure on others to move offshore becomes great. I have had many bookies come to me and say, “We would like a level playing field, because it isn’t fair to be driven offshore by competitors who are not paying tax when you are.” Today I would like to propose that instead of having what has essentially become a voluntary tax, we create that level playing field by ensuring that all gambling in the UK pays UK tax and the UK levy. Let us also make it a compulsory level playing field.