The British Horseracing Betting Levy Board warned the Levy from the segment is on track to severely fall short of the expectations.
UK.- The British Horseracing Betting Levy Board (HBLB) has issued a warning about the Levy for the UK industry. They expect it to fall considerably short of expectations as it’s on track to pay €9.4 million less than the previous year.
The HBLB expects the Levy for the 12 months to March 31 to reach €88.8 million, down from 2017-18’s €111.6 million. It would also be lower than the previous forecast of €101 million by the British horseracing body.
“Bookmaker profits in the fourth quarter, particularly in February and March, were reported to be very substantially down on estimates,” HBLB chair, Paul Lee, said, as quoted by iGaming Business. “This has led to a material undershooting of Levy income against forecast, even taking into account that yield was not expected to reach the €108 million of 2017-18.
“This is only the second year of the extended Levy and the inherent uncertainty was recognised by the Board in 2017, which led to its policy of increasing reserves significantly over the past two years. The purpose of having these reserves is to be able to shield Racing against substantial fluctuation.”
“The Board will look to put in place additional reporting arrangements with major bookmakers, who are already helpfully providing significant data to the Board on a voluntary basis,” he said.
The Racecourse Association, The Horsemen’s Group and the British Horseracing Authority already met to discuss the course of action. “We were shocked to see the big drop in Levy yield for 2018/19,” a spokesman for racing’s tripartite leadership said. “It was significantly below the previous forecast at the end of March. We share the disappointment that our sport will feel having produced some highly competitive and compelling racing over the past year.
“The bulk of the Levy income is distributed as prize money. At a time when there is already significant debate in the industry around levels of prize money, we appreciate that any potential reduction will cause further concern.
“The recent positive reporting from the betting sector on the growing attraction of betting on our sport makes clear that the issue isn’t the popularity of racing as a betting product, but rather its potential profitability. As the Levy is based on those betting profits, that is clearly concerning for all in racing.”