Government announces levy rollover for 2017-18
The government has determined a rollover of the current levy for 2017-18, a scheme that will only be applied if the replacement system is not established by April.
For the second successive year the matter had been referred to the Department for Culture, Media and Sport after members of the Levy Board and bookmakers' committee failed to come to an agreement by the October 31 deadline.
Although the scheme is set to be scrapped, the process required completion as legislation for the new mechanism has not been passed.
Having a deal in place also provides a funding safeguard for racing should there be any delays in the timetable for the new system.
A DCMS statement attributed to culture secretary Karen Bradley read: "In the March 2016 budget, the government set out a timetable for replacing the current Horserace Betting Levy by April 2017. It remains the government’s intention to replace the current levy scheme by this date.
"However, until such time as the legislation has passed, the existing statutory requirements remain. Therefore my determination for the 56th levy scheme will only apply should the new levy not be in place by April.
"With this in mind, and having considered the arguments put forward by both betting and racing, I have decided to direct that the current levy scheme should continue to have effect for 2017-18."
The statement, which also expressed disappointment that the two sides could not come to an agreement, continued: "In making this determination I have had regard to the offer made by the bookmakers' committee and taken into account the racing members of the board's reasons for rejecting this offer.
"Any discussions or negotiations about voluntary levy contributions in respect of offshore remote betting operators are outside the scope of my statutory role in making this determination."
It is understood the Levy Board had been willing to accept a cut in the 10.75 per cent rate for statutory levy to ten per cent – the figure sports minister Tracey Crouch is "minded" to set for the replacement system – but the bookmakers' committee's offered 7.5 per cent with assurances that operators would pay across online betting as well.
Responding to the determination, bookmakers' committee chairman Mike O'Kane said: "It's effectively a rollover and it was what was expected after racing rejected the offers of the bookmakers' committee. It now all depends on whether the government can deliver on the proposals and in time for April."
BHA spokesman Robin Mounsey said: “British racing welcomes the quick conclusion of the determination of the 56th levy scheme and its headline rate of 10.75 per cent, but levy replacement by April 2017 remains our clear focus and we continue to work with government to meet this critical deadline for the funding of the British racing industry.
“The government has again stated its intention to have a levy replacement implemented by April 2017, which will capture revenues from all offshore betting operators at a time when over 50 per cent of all betting on our sport takes place through digital channels.”