HMT Remote Gambling Tax Consultation

The Treasury recently released a consultation on the tax treatment of remote gambling. Trailed in the Autumn Budget last year, the consultation proposes a new, single remote (i.e. online) gambling duty, which would involve harmonising General Betting Duty, Remote Gaming Duty and Pool Betting Duty.

This would mean that online betting would be transferred from the existing General Betting Duty (currently 15%) and incorporated into the same tax regime as online gaming, currently subject to a separate Remote Gaming Duty (currently 21%).

The rate at which the new duty would be set at is not part of the consultation.

We are deeply concerned about the prospect of any tax harmonisation which places horserace betting on a par with online games of chance, and believe that there would be significant unintended consequences for both racing’s finances and its workforce if government moves to a single duty.

This is principally down to the expectation that tax harmonisation will reduce the attractiveness of racing as a product to the betting public, with behavioural changes assumed from operators as they look to save costs by maintaining margins and reducing offers and promotions, therefore minimising the customer experience.

On behalf of British racing, the BHA will submit detailed evidence to the consultation ahead of the deadline on 21 July, making the case for keeping the existing system. We will be working with stakeholders across the sport to build a strong argument, making sure that racing’s position is fully understood by the government.

In the meantime, the BHA Corporate Affairs team will meet with Treasury officials in June to raise our concerns and will speak to DCMS about what support it can offer as our principal Government department.

Combined with a continued delays to Levy reform and an inconsistent regime of affordability checks and restrictions on bettors, duty harmonisation would result in racing facing a ‘triple whammy’ of financial problems. We are keenly aware of this threat and continue to do all that we can to make the sport’s case to policy makers.

Temporary Admissions

As a result of lobbying by British racing, the Government has announced changes to the Temporary Admissions (TA) procedure that will be beneficial to British racing and breeding. TA allows certain goods, including racehorses, to be imported into the UK temporarily without payment of customs duty and import VAT.

In 2023, the BHA, along with horse transport businesses and industry stakeholder bodies, responded to a call for evidence from the Treasury and HMRC on the TA procedure. We set out that the free movement of Thoroughbreds is vital to maintaining a world leading and competitive programme of racing and emphasised that easy access to other countries is crucial for maintaining Britain’s pre-eminence in breeding Thoroughbreds. The Government will now take forward a set of targeted simplifications and improvements to TA, including:

• Clarifying policy and guidance so that a 2-year limit is consistently applied for horses used for breeding. This will support the UK’s breeders and simplify time limits for horses by ensuring 2 years is the standard maximum period, however the importer intends to use them.
• Amending policy to permit gelding of horses that are under TA, as long as they were not imported for that purpose.
• Making it clearer in the guidance on how to apply for an extension to a time limit, if this is necessary.

These changes, which will be implemented by this summer, are a significant win for the industry and will help to ensure the importation of racehorses remains cheaper and streamlined, and clarifies that customs duty and import VAT do not have to be paid on them.