‘Paradox’ Of Taxes On Race Clubs

Press, Volume CVII, Issue 31449, 16 August 1967, Page 4

‘Paradox’ Of Taxes On Race Clubs

(New Zealand Press Association)

AUCKLAND.

The method of taxation on racing produced the paradox that taxes became greater as profits declined, said the president of the Auckland Racing Club (Dr. A. McGregor Grant) in his annual report to members. The costs of the Auckland Racing Club had increased until no surplus of income remained.

The report said that a los-s of $24,166 in the clubs’ accounts arose from “increases in items of expenditure or reduction in Income over which your committee has no control.”

The only major item of expenditure which could be adjusted, the report said, was stakes, but it must be realised that stake money had increased at a slower rate than currency had depreciated.

At the same time costs of maintaining a horse had been steadily increasing and so the position of the owner had become progressively worse.

The racing industry was in a peculiar position. It was taxed on turn-over, not on profit, a situation which did not occur in other commercial enterprises. The executive of the New Zealand Racing Conference had studied the situation and had

made representations aimed at securing a readjustment of income between the Government and clubs.

“A proper measure of relief is essential to safeguard the future income the Government expects from racing,” said the report. “An adequate measure of readjustment now could so stimulate racing that in a very short time the Government would be receiving even more than it does at present. Small palliatives given to a section of the industry will bo of no avail.”

The total amount of money put through the totalisator had increased. Taxation remained at 9.3 per cent, therefore the Government’s receipts increased etery year, but, as in all business, the overhead costs had increased and all these costs had to be accepted by clubs.