RACING TAXATION

Hawke's Bay Tribune, Volume XVIII, Issue 201, 8 August 1928, Page 7

RACING TAXATION

CLUBS’ DIFFICULTIES

HOW FINANCE MINISTER VTEWS THEM. SUGGESTED MEANS OF ASSIST • ING SMALL CLUBS. The Minister of Finance, the Hon. W. Downie Stewart, in the’ course of bis Financial Statement presented in the House of Representatives last evening, dealt briefly with the question of racing taxation as follows:— “I have carefully examined the fre quent statements by racing depurations that they are being crushed by heavy taxation. I am unable to find any warrant for these statements. In fact, the racing clubs do not ask that the taxation imposed on the public should be reduced, but merely that, they should receive a larger share of it. While it is clear that some dlubs are in financial difficulties, it is equally clear that these difficulties do not arise from Government taxation. “The main source of the racing clubs’ revenue is the totalisator-tax. A levy of ten per cent of the money put through the machine. The clubs take 7i per cent, and the Government only 2} per cent. This tax has not been altered since 1910, so that the frequent statement that the clubs suffer from increased war taxation has no foundation. The 2J per cent which is handed over to the Government is merely collected by the racing clubs as agents for the Crown, and in no way renders then the poorer. The dividend-fax was increased in 1921 from 2J per cent to 5 per cent. This is also levied on the investor’s money, and the dividend-winner pays it. not the club. It is like the total-isator-tax, collected by the racing clubs as agent for the Crown, and does not in any way tax the revenues of the club. These remarks also apply to the stakes duty and amusement tax.

“It must not be forgotten, too that although for a short period in 1921 the unpaid fractions of dividends were taken by the Government they were shortly afterwards again conceded to the clubs. These amount approximately to between £35,000 and £40,000 a year. “In 1925 li per cent of the totalisator duty on the first £20,000 (equivalent to £250) was rebated to each club for improvements effected to grounds. This meant a further concession to the clubs of £26,000 per annum of the Government’s small share of the totalisator-tax. The clubs also benefited considerably from the general abolition of income-tax on income derived from the use of lands. The stakes duty was reduced from 10 per cent to 5 per cent in 1924 a concession valued at £30,000; and the tax of 2} per cent on payments for admission to the course, valued at £6500. was repealed last year. “To sum up, the remissions and concessions to racing in the last few years are -worth over £lOO,OOO a year. “My reason for recapitulating these facts is to show that financial difficulties of the racing clubs pre due to causes which have nothing to do With taxation.

“I would suggest for consideration that the most practicable way in which assistance can be given to the smaller chibs is to fix the totalisatortax on a graduated scale, so as to practically exempt the small clubs from taxation. So far the metropolitan clubs have not received this proposal with favour. “If, however, there is any assistance within reason that can be grant ed to the country clubs, I feel sure that when the opportunity occurs Par liament will support it, as it js highly undesirable that all the racing facilities should be concentrated in the cities.’’