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Peter George: Blame Government for the Death of Horse Racing

...calls for construction of Caroni Racing Complex to restart
Published: 
Sunday, August 10, 2014
FACE-TO-FACE
Peter George. Photo: Roberto Codallo

Local horse racing is in its death throes, according to the president of the T&T Bookmakers Association Peter George. Blaming the Government for the imposition of a ten per cent turnover tax on every punter placing a bet, George said many punters have gone underground to place illegal bets because of the disputed tax. Interestingly, he is suggesting that the Betting Levy Board investigate and restart construction of the controversial and scrapped Caroni Racing Complex to ensure the survival of the industry.

Q: Mr George, am I correct in saying the local horse racing industry in T&T is undergoing serious stress?
A: (At his Ariapita Avenue office, with an emphatic response) Yes. That is correct. The volume of betting—particularly in the private betting shops better known as betting pools—has dropped between 33 and 45 per cent over the last three years.

What’s mainly responsible for this state of affairs?
Well, the reason for that is over the years the people who used to bet on horse racing have now migrated to betting on other sports and all activities including soccer, football, whatever. In so doing, the level of horse racing has started to decline but more important, the real impact on the drop of betting on horse racing is the existence of the Government’s ten per cent turnover tax which the punter has to pay since the Betting Levy Board was enacted about 15 years ago.

If my memory serves me right, didn’t I interview you around that same time where you had expressed a similar fear about the death of this sport because of that same tax issue?
That is correct, and that has always been a fear. We have made all sorts of representations to the BLB (Betting Levy Board) and to the Government about the removal of the tax because it is impacting negatively on the people who are betting. Punters are not desirous of paying that tax each time they place a bet, and they have gone over to betting illegally with underground bookmakers (bookmaker, bookie or turf accountant is an organisation or a person that takes bets on sporting and other events at agreed upon odds).

Illegally?
Yes. Because the underground bookmakers do not charge any tax. So here’s a man who wants to bet $100 and who doesn’t want to spend $110. And that is getting worse. This form of betting is increasing substantially in T&T and there are underground bookmakers even in your own betting shops soliciting punters to bet with them.

So it is a serious problem because our volume of betting is dropping and expenses remain or are getting higher. It is not economically viable, hence the reason why so many betting shops have shut down.

What has been the response by the board to your (proprietors of private betting shops) plight?
We have complained to the BLB saying, “Look, let’s get together and get a formula for a simple flat tax paid yearly instead of this burdensome ten per cent on every bet placed. In that way, we would be able to mitigate the underground betting and to a certain extent be able to streamline our business, and the board can budget themselves on the basis of knowing exactly how much tax would be collected each year. In a way, they like the suggestion. But the figure they want to charge the betting shops is totally unrealistic.

How much are they asking for?
They are asking double for what we are recommending—we recommended $2 million per year, per pool, as the flat tax. The BLB is saying that is too small, and they want a total of $35 to $40 million a year. Now that cannot work.

In terms of employment and generating revenue how are the pools fearing?
Many betting shops have closed. Right now we have only 11, and more may close down. I can assure you people have lost their jobs and right now, with 11 shops, the board does not realise the severity of the problem. The shops employ 750 people and indirectly another 250.

Couldn’t it be argued that if the shops where shut down, it would be no big thing if that happens...
Right now these betting shops are the bread basket that is keeping local horse racing alive. We contribute between $16 and $18 million per annum and that money is used to sustain the industry. If they don’t have tax that is being paid by us, there is no doubt the Arima Race Club would be forced to close down themselves. That is how serious it is.

Do you think the board is acting on their own or they have to wait on the Government before acting?
No. Based on their terms of reference they can act on their own. If there is anything over and above their limit they will have to get Government approval. But so far, they have been acting on their own.

Is the board trying to run you all out of business?
No. I don’t think it is deliberate. I think they do not know what they are doing. They are unaware of the problems in this industry.

Are the bookmakers represented on the BLB?
Again, the legislation requires a member of the T&T Bookmakers Association to sit on the board. I, Peter George, as president of the association sat on the board for approximately nine years. Last year, I resigned because in my opinion, sitting on the BLB was a waste of time. The association is not represented. I wrote to the relevant authorities and I think I copied the line minister who is the Honourable Vasant Bharath, that we are not interested in sitting on the board. 

Actually, Minister Bharath had many meetings with us and he is really trying to be helpful, but it is a kind of delicate situation in terms of the agreement between the board and the betting shops. So he is between the devil and the deep blue sea. I must commend the minister for trying, but no improvement has been found.

Mr George, how long can the 11 surviving shops continue to carry on in this present scenario before the death of the industry, as you would say?
Well, Clevon, unless the law is changed, the demise of the private betting shops may go first. I would say in two, three to four years from now, there would be no private betting shops if the existing law remains. Whereas, if the law changes to allow for a simple reasonable one flat annual tax, hopefully the private betting shops may survive. If not, local racing would not survive because they would have to close unless the Government supply them with a lot of money. And, Clevon, this law itself is bad law.

Meaning?
There is no ten per cent turnover tax nowhere in the world, except maybe one country which I cannot remember at this time. What the board wants to do is to place computers in all the private betting shops so that they can quantify exactly how much money is taken by every pool and how much tax they were supposed to pay.

They want to bring in computers from a state enterprise to put in private business. That is totally unconstitutional, but they say they could do it and I think they are proceeding with it, but it is not going to be that easy as we are going to take action against that.

 Mr George, isn’t there any way you all can make private betting shops more attractive to bring back the punters who have gone underground and who are now betting on sports from foreign places?
The only answer is to drop the ten per cent tax…that is the only way we can survive, and we give punters all the benefits they are accustomed to. The BLB is of the opinion the private betting shops are not paying the right tax and that is absolutely incorrect.

What about the Arima Race Club?
Local racing will die even if we continue to pay the ten per cent tax, unless they remove from those facilities in Arima. It is derelict, the conditions are terrible including the paddock, the place hot and sweaty, and its customer service needs to be improved.
Of course there have been some improvements, but conditions are not up to standard.

 So what is the answer?
I think that local horse racing could be a very nice and successful industry but it is going to fail in Arima. What they need to do is make representations to the Government to resuscitate Caroni, which was the original plan for a central facility. A lot of the infrastructural work is still there and in fairly good shape.

The ARC (Arima Race Club) can sell its 70 acres of land to a private developer, use that money to continue finishing Caroni and any shortfall, the Government can do a soft loan and build a nice facility down there at Caroni. That was a very bad mistake that former PM George Chambers made in stopping Caroni because at that time we already had $57 million in the ground. The Government has a role to play in the survival of horse racing.