'Trainers are crying out for some good news' - NTF and BHA issue stark warning over prospect of increased business rates

Increasing business rates could force trainers out of the racing industry in the latest blow to the finances of those who work in the sport, the chief executive of the National Trainers Federation (NTF) has warned.

The government unveiled detailed guidance for its new policies last month, redefining which properties will qualify for the new retail, hospitality and leisure (RHL) lower business rates multiplier from next April. 

Racing yards have been able to claim RHL relief at a rate of 40 per cent, but they will not qualify in April because the guidance states it will be restricted to properties or venues "wholly or mainly" used for in-person retail, hospitality, or leisure activity provided to "visiting members of the public".

The change represents another significant financial headwind for racing yards in Britain, with research published by property agent Colliers forecasting increased costs of more than £7,000 per yard and over £10 million in total next year, and NTF chief executive Paul Johnson said his members were "crying out for some good news".

Johnson said: "While we've been reassured, to some extent, by communications from government that there's an understanding of how racing needs to be supported if it's to continue to survive, here we face yet another challenge.  

"After Covid, businesses in the sport were vulnerable and needed help to return to stability; since then, we have seen ballooning costs due to inflation, National Insurance hikes, and revenues hit by the implementation of affordability checks.  

"Our members are crying out for some good news, yet all we have appearing over the horizon are more problems, and we can expect to see increasing numbers contemplating giving up."

Trainers' chief Paul Johnson: "We can expect to see increasing numbers contemplating giving up"Credit: Scott Burton (racingpost.com/photos)

The BHA expressed its own alarm about the potential impact on racing yards and said it had raised the matter with MPs and government. A spokesperson said: "We’re concerned about the impact that the removal of business rates relief will have on racing yards. This news comes at a time when British racing already faces the prospect of damaging tax hikes in the budget that would have a devastating effect on our industry, businesses and people.

"We have urgently raised this with MPs and the government. We are also working with the NTF and external ratings experts to understand what scope there may be to protect trainers against what could potentially be another big blow to their business operations."

John Webber, head of business rates at Colliers, believes the increase in business rates could "put many over the edge". He said: "The actual impact will depend on each property’s rateable value, but for most yards this change will represent a return to full business rates liability.

"Trainers work on small margins; they employ many people on low wages, so the recent hike in employers' National Insurance contributions and the national minimum wage have already impacted them hard. To add on increased business rates costs could put many over the edge."

Changing business rates are an additional blow to betting shops ahead of the budget on November 26. Chancellor Rachel Reeves has indicated betting duties are set to rise, which has also caused huge concern in racing.

Bookmakers have warned any increases to machine games duty (MGD), levied on machines in betting shops, would lead to widespread closures and the knock-on impact of racing losing more than £20,000 in media rights and levy payments with every shop shut.

Despite being used for in-person activities, betting shops will be ineligible for the lower multiplier rate and Colliers estimate it could cost the industry in excess of £10 million per year in business rates.

Webber added: "Taxing the betting industry will certainly not help the high street, and only lead to more empty shops. And the knock-on effects are further reaching, for example, for the horseracing industry. Less money for British bookmakers means less money for British horseracing, an industry already under attack from the chancellor’s business rates strategy."

Read these next:

‘Come and see what we do’ - betting shop champion’s message to politicians amid fears of tax hammer blow 

Treasury committee recommendations to raise gambling duties would 'decimate' racing 

Racing faces ‘stealth tax’ if chancellor hits betting shops in budget, bookmakers warn 

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