The Horserace Betting Levy Board (HBLB) anticipates receiving £105m in levy payments across the 2023-24 UK horseracing season. This would mark the third successive year of increased levy contributions, surpassing the £100m paid in the 2022-23 season.
For those unfamiliar with the levy in UK horseracing, this is a fiscal mechanism that guarantees that bookmakers provide funds to underpin the sport. It was created in 1961, with bookies enforced to ring-fence a percentage of their gross profits from bets placed solely on horse racing.
How important is the levy to British horse racing?
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The levy has a four-pronged approach to supporting the sport. Firstly, it helps to provide substantial prize funds across the season. In 2023-24, the £105m in levy payments meant that the HBLB could hike total prize money by £3.2m to a maximum of £70.5m.
Secondly, the levy is used to invest in racecourse venues, improving facilities for racegoers, jockeys, thoroughbreds and trainers alike. The levy also helps to fund important initiatives surrounding training and breeding, protecting the integrity and heritage of British horse racing.
Finally, the levy is also used to fund important regulatory bodies and charitable organisations to maintain fairness, safety and transparency in the ‘Sport of Kings’.
Why is there renewed focus on the levy right now?
As part of the white paper based on the UK’s gambling industry and its regulatory framework, the levy for British horse racing is set for review, with terms expected to be negotiated by stakeholders in the sport and the Betting and Gaming Council (BGC), who will negotiate terms on behalf of the bookmakers.
In the UK, horse racing is the second most popular sport to bet on. A YouGov survey found that more than one in three (37%) of respondents had placed a wager on a horse race in the 12 months prior to the survey.
Horse racing is embedded within British popular culture whether by the iconic races of the Aintree Grand National or the Cheltenham Gold Cup, or the thrill of becoming part of a syndicate to own a winning racehorse, this sport has a unique pull. On the subject of the latter, more people are looking at shares in thoroughbred racehorses as unique horse racing gifts for loved ones, giving them a chance at owning a true champion flat or jump horse.
Prior to the decision by former Prime Minister, Rishi Sunak, to announce a July general election, it looked like the sport was coming close to doing a deal with bookmakers on a revamped levy agreement that was mutually beneficial. However, the BGC withdrew its support at the final hurdle, a claim which the BGC later refuted. Indeed, the BGC responded by saying the British Horseracing Authority (BHA) had thrown out multiple offers on the levy.
It was suggested just a few short weeks ago that bookies had agreed to increase the levy rate from 10% to 11.5% of gross profits, something which sports minister Stephanie Peacock said was considered “reasonable” by the sport’s gatekeepers. Talk of expanding the levy to wagers placed in the UK on overseas horseracing has been thrown out by Peacock, at least in the short-to-medium term. That’s despite it potentially raising another £20m per annum for the sport.
Peacock is trying hard to focus minds, but it’s clear the government doesn’t really want to get its hands too dirty, with the BHA and BGC urged to find common ground and reach an agreement voluntarily in the weeks ahead as the 2025 season looms large.
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