RACECOURSES will be pushing their way to the front of the queue when Horse Racing Ireland [HRI] is allocating its annual grant of €76.8 million among the sport’s stakeholders in the coming weeks.

HRI got a great result in this week’s Budget, the Department of Agriculture handing the semi-state body a 14% increase in funding for 2021. Now the executive must decide how to invest it and it is sure to be high on the agenda at Monday’s board meeting.

Ireland’s racetracks have been starved of most of their revenue since March and they are estimated to have lost between €12 million and €15 million in the past seven months, with seemingly little prospect of racegoers being allowed return before the end of the year.

Conor O’Neill, chairman of the Association of Irish Racecourses [AIR] said: “AIR will be seeking direct financial assistance for racecourses to be included within this budget in order to mitigate the significant losses that are incurred as a result of the current scenario of racing behind closed doors. This is obviously vital in order to keep the industry afloat and protect employment.

“The longer this situation continues the greater the severity which the financial impact is having on racecourses increases as it is simply not commercially viable for a prolonged period of time. Therefore, we will be working closely with HRI to achieve this and most importantly to ensure the 26 racecourses throughout Ireland can remain sustainable as we all continue to look forward in anticipation to better days ahead.”

VAT issue

The Irish Thoroughbred Breeders’ Association [ITBA] also welcomed the increased Government commitment to racing in the Budget, along with the increase in the flat rate addition for farmers to 5.6%. This allows sole traders such as private breeders, who are not registered for VAT, to claim back a portion of their business expenses.

However, the ITBA’s chief executive Shane O’Dwyer said he was “surprised and disappointed” that the equine sector will not benefit from the Government’s lowering of the 13.5% VAT rate to 9%. “It is the only sector which previously qualified for the 9% VAT rate which has been excluded,” he said. “We believe this is an unfair exclusion and we are actively lobbying to get the decision reversed in the upcoming Finance Act.”

The VAT on horse purchases was raised from 9% to 13.5% in Budget 2019 (October 2018).

Dual challenge

HRI’s increased funding was confirmed at a Department of Agriculture press conference in Dublin on Wednesday. Martin Heydon, Minister of State in the Department, said: “The Horse & Greyhound Racing Fund will be €96 million for 2021. This increase of €12 million recognises the challenges faced by these industries, which are primarily rooted in rural Ireland. Both have been affected by Covid and there are concerns in the horse racing sector around Brexit and the impact that changes in the Tripartite Agreement could have.”

Minister Heydon added that the Department was allocating a separate €1.5 million towards the redevelopment of the Irish Equine Centre “which is of critical importance to the sector.”

Contrary to pre-Budget speculation, there was no increase in betting tax announced. The Government received €91 million in betting duty in 2019. A recent report by the Government’s Tax Strategy group found that betting duty receipts for the first seven months of the year were on a par with last year, despite the lack of sporting activity for several months earlier in the year, “reflecting high levels of betting prior to the effects of Covid taking hold in Ireland.”

RACING’S ANNUAL GRANT

2014: €43 million

2015: €54 million

2016: €59 million

2017: €64 million

2018: €64 million

2019: €67.2 million

2020: €67.2 million

2021: €76.8 million