Madam, – Of course bookmakers should pay tax (including corporate tax, employee tax and turnover tax) to the Exchequer. However, this tax should not find its way into the pockets of wealthy horse owners.
Stallion owners, who are beneficiaries of the Irish thoroughbred horse industry, should also pay their fair share of tax to the Exchequer. Brian Cowen, when minister for finance, introduced a mechanism in Section 26 of the Finance Act 2007 which enables stallion owners to claim tax relief on money they never spent. This is outrageous! This highly advantageous tax treatment is on top of the hundred of millions that Government has grant-aided racing in recent years.
This funds the prize money, much of which is collected by these self-same breeders. So they benefit on the double. I respectfully suggest that this type of tax loophole for wealthy people should be discontinued by the current administration forthwith. – Yours, etc,
Madam, – Patrick Kennedy in his letter (May 30th) took issue with a statement I made to your correspondent that “bookmakers . . . rely on racing for the bulk of their business” (An Irishwoman’s Diary, May 21st). I made this assertion for a number of reasons, not least information released by Paddy Power in 2009 that horse and greyhound racing in total amounted to 85.4 per cent of its turnover. Is Mr Kennedy suggesting that his business has changed so much in the past two years that his racing income has fallen to some 10 per cent? Or is it because he continually restricts his information to Irish racing and completely ignores British and overseas racing when he makes this argument? Irish and British racing and breeding operates as a single market.
There is a huge involvement in British racing by Irish trainers, jockeys, owners and of course Irish bred horses. This accounts for the substantial interest by Paddy Power customers in British racing. Hence my basic point about the reliance by bookmakers on racing for their income.
In his letter, Mr Kennedy also attacks the level of prize money won in Ireland by foreign owners. I would point him to a report produced last year by respected economist Colm McCarthy which showed that owners in Ireland recouped only 10 per cent of their total annual outlay of almost €300 million on maintaining horses in training here in Ireland.
This money represents substantial foreign earnings which are spent almost exclusively here in Ireland, supporting thousands of high-quality and well-paid jobs throughout the economy. Indeed, we should all be encouraging this investment in our economy and recognise that owners in Ireland make a far higher contribution to prize money than in any other racing country.
Mr Kennedy chooses to take a five-year average for the level of prize money per race which he quotes, but fails to state that Irish prize money has fallen by 30 per cent in the last three years. Irish owners contribute a far higher amount through entry fees than in Britain; and when this is taken into account prize money per horse in training or per runner in Britain is substantially higher than in Ireland, and far short of the levels available to owners in France, Singapore, Australia, US, Japan and Hong Kong.
I am pleased to be able to agree with Mr Kennedy on at least one point, which is his acceptance of the need to tax the betting industry. The Paddy Power website shows that it operates offshore under a licence from the Isle of Man Gambling Supervision Commission and hence does not currently pay the very low 1 per cent betting duty payable by Irish licensed bookmaking shops!
Finally, I note from a letter published alongside that of Mr Kennedy by a Tom Hendron that the betting industry in Ireland paid €37 million in betting duty in 1990 (21 years ago) whereas it only contributed €30 million last year despite an almost ten-fold increase in turnover during that period. – Yours, etc,