RACING AND REVENUE.

New Zealand Herald, Volume LXVIII, Issue 20930, 21 July 1931, Page 7

RACING AND REVENUE.

..TAXATION . QUESTION.

THE PRACTICAL ISSUES.

POINTS OF COMMON .CONCERN

It is impossible to make a precise estimate of the amount the Government will receive' in racing and trotting taxation for the year;'just closed. The president of .the Now Zealand Racing Conferonce has placed ori record figures showing that total taxation on racing has been £352,747, against £408,412 last year. The totalisator tax yielded £169,452, an increase of £36 516, but the dividend tax of £152,410 showed a decrease of £86,736. Complete figures relating to the trotting sport arc not available. It would appear that a substantial drop in this form of Government revenue will be experienced.. ; i- . • ■ - It is obvious, however, that the decline in betting of roughly 15 per centwill mean a ,heavy decrease in the sum normally paid into the Consolidated Fund from this direction, notwithstanding the increase in the "rate of tax. The question is one of general interest. Whether one is an opponent of gambling or no, the fact- has to be realised that racing and trotting have been made the avenue for the collection l of a large amount of revenue upon which Ministers of Finance liave depended. The total - for 1926 was £634,482; for 1'927, £559,627; 1928, £564,032; 1929, £533,658; and 1930. £551,123; thb clubs receiving a slightly higher amount, plus unpaid fractions, ranging from £35,000 to £39,000 a year, v Share of the Treasury.

It was stated by a correspondent the other day that "the Treasury takes out of every pound invested no less than 3s 4£d," This, of course, is not so. That is the total taxation, the share ..of the Treasury being Is 10? - and .that of the clubs Is 6d. The present rate of totalisator tax is 5 per cent., this being imposed in August, 1930, at which t:me it was 2£ per cent., a rate that had been in force since March, 1910, prior to which it was 1£ per cent. Provision is made for a refund of V 4 per cent, up to a limit of £2so' to any club which, during the year, has expended an amount not less than the amount of refund in permanent improvements. In November, 1915, a tax of 1 per cent, was imposed on air stakes, and a tax of 24 per cent, on dividend?. In December, 1921,' the stakes tax was increased to 10 per cent., but it was reduced •to 5 per cent, in April, 1924. The dividend, tax was made *5 per cent, in 1921 and so it'remains. Various Reactions.

The present position, of trotting and racing is primarily due to the depression/and, a consequence. has been the lowering of .stake, money, .which reacts upon, owners' returns ..and jockeys' and drivers' earnings. But there is another factor operating and the assertion is made that. taxation has now reached such a figure., that more and more bettors are becoming increasingly disinclined to hazard-.:.money from which such- a substantial pottion is deducted for State and club ■'? revenue. Hence the proposals for enlarging the scope of the "machine" and the facilitation of betting by telegraph. : It is understood that illegal bookmaking'has experienced a heavy drop in its ""business"-but, nevertheless, a very considerable amount of betting is done' privately- for though the bookmakers pay only totalisator odds with a limit, many of . them also do "business" on doubles and even on trebles, which has a great fascination for many, despite the fact that prices offered for popular combinations are not considered satisfactory by many patrons. Telegraph betting facilities, 'the clubs imagine, would divert to the totalisator much of the money now placed privately. Whether that is likely to be so or not need 1 not' be discussed here.',.

Revenue and Employment. The present purpose is to consider the effects'of the decline in totalisator gambling. The Consolidated Fund is suffering and, iD addition, one must consider the effect upon employment which, in view of the present situation, is one of monient. It has been said, that the racing "industry" employs 40,000 persons. This is a guess. But without accounting for the thousands of people who receive casual employment through racing, there remains a large number permanently engaged in training and riding or driving horses and the question has to be considered whether some of these will drift into the ranks of the unemployed, who must be maintained by the Unemployment Fund if owners are driven out of the sport by taxation. Oft the one hand- there is a section of; the people who, as anti-gamblers, say that the country would be much better off and have less poverty, if there were no racing or trotting; on the other there is the body who believe that the sport, having been recognised by the State as a revenue-collecting agency, owes an obligation to horse owners and their employees, and also to the clubs which have commitments they must in honour meet; and (hat. arguing over what by some is regarded as a . moral issue will not help the immediate situation, which is so manysided. : • -