LATE CORRESPONDENCE

Hawera Star, Volume XLVII, 20 August 1928, Page 11

LATE CORRESPONDENCE

RACING TAXATION. (To the Editor.) Sir, —Your leading article on this suojeco appearing on the 16th inst. reviewed tne position from the standpoint or tne Minister or Finance and oi one racing club only, the circumstances governing the meetings of which are purely local and have no general application. It is desirable, therefore, that your readers should know that in t-lio opinion of the large majority of racing clubs in the Dominion the taxation at present imposed is excessive, and is undoubtedly seriouly retarding the progress of many clubs. At this point I wish to correct two errors that have occurred in your leader. First, that the present* rebate of totalisator tax available to clubs has been granted since 1915 (this should be 1925), and, secondly, that the rebate is not available to clubs whose totalisator investments do not exceed £20,000. The rebate is available' to all clubs in the proportion of li per cent on investments, but not exceeding £250 in any one year, i.e., li per cent on £20,000. Another point is that stakes are said' to be on too high a scale, but the cost of maintaining racing stables and of travelling of horses by owners has; so much increased in recent years without a corresponding increase in stakes that should such conditions continue it will lie only a: matter of time when the smaller clubs would receive insufficient support to' continue, and race meetings 1 would he available only to those able to attend in the larger centres of population. It may not he •generally known that racing clubs, through their conference, have imposed upon themselves a minimum amount to he given in stakes, being the net profit received from the totalisator. less 10 per cent, for unless reasonable stakes are offered to owners inferior class racing would result, with the inevitable serious reduction in receipts to tbe club and also of taxation received by the Government. It has been said that some clubs have lieen extravagant in expenditure, but this is not of general application', and is not the reason why many country clubs in populous and prosperous districts are feeling the strain of overtaxation.

You. sir, stress the point made by the Minister, “that the public bears the greatest proportion of the taxation,” but this has never been disputed, and no one knows better than the .racing clubs that it is the public whose support is accorded the meetings that enables the sport to be conducted under the excellent conditions obtaining in the Dominion to-day. The sources of revenue available to clubs are, however, very limited, being practically confined to gate receipts, entry fees from, horse owners, and the proportion of totalisator tax allowed by the Government. The value of the first of these is obviously dependent upon the public attendance, at meetings, tbe second upon the entries attracted by the club conducting a good meeting * and offering reasonable stakes, and the third upon the amount of money invested .by tbe public. A brief survey of any club’s bal-ance-sheet will prove that the overhead charges of’a race meeting conducted on sound lines cannot be kept below a certain minimum, which has with, many clubs in recent, years been greater than the net profit derived from the available sources of revenue. It is therefore reasonable to assume that, should stakes be heavily reduced, a falling off in entries may be expected, with consequent reduction of public interest in tbe meetings, decreased attendance, and' less investments on the machine, consequent upon which would be a heavy reduction in Government revenue by way of taxation.

Quite contrary to the Minister’s statement, which is accorded your support, the clubs would welcome a. reduction in the tax imposed on the public, but the first consideration should be a. reduction of the tax upon clubs, witliput which some clubs will be unable to carry on, and in others the standard of racing is likely to decline. The inequitable nature' of the present tax lies in the fact that it is imposed upon totalisator investments, regardless of whether the club shows a profit or a loss on its annual working. It should be remembered also that no racing club in tbe Dominion is a proprietary concern, no member has a right to a share of any assets whatsoever, but that clubs are established to .further the interests of racing and to provide facilities for the meetings to be conducted in the interests of the sporting public.—l am, JNO. GRAY. August 20.