NZ/Oz government support for racing

[curious]

 

On 15/04/2019 at 2:13 PM, curious said:

I wish people would stop saying that and look at the numbers. What Australian racing get back from Government is a modest proportion of what they give government. The opposite is true here and some want more from NZ taxpayers. It's bullshit and ridiculous.

 

On 1/05/2019 at 12:17 PM, Laurie Sutherland said:

Curious

The latest NZ Racing Board Annual Report I have is for 2013.

It states that for the 2013 season N Z racing paid TO our Government:

        Betting Duty of $10.873million

       GST (Net) of      $38.356million

       Total                   $50.229million.      You will look in vain to find even $1 paid by NZ Govt to NZ racing.

 

And in 1992  we paid  Betting Duty of $42.494million

                                       GST of               $18.331million

                                      Total of              $60.825million.   and got NOTHING in return.

 

Laurie Sutherland

 

On 1/05/2019 at 4:55 PM, curious said:

Thanks Laurie.

I don't have the 1992 figures to confirm that but the latest 2018 figures are here.https://www.nzrb.co.nz/sites/default/files/documents/NZRB1679_Annual_Report_2018_FINAL2.pdf if you want to take a look. I was about to write a fuller response but just saw this which is along similar lines to my thoughts that I was about to share. Good to have  your input again.

https://www.RP.net/node/3181

 

20 hours ago, Laurie Sutherland said:

Re the comment at www.RP.net/node/3181:

The main reasons why Govt has an involvement in Racing include:

1.  In 1951 they created the NZTAB to handle off-course betting, and to collect some gaming duty tax off that betting.   Previously such betting was available only thru bookmakers, who in general operated illegally and paid little or no gaming tax on their operations

2. The gaming tax collection part is controlled by the NZ Gaming Duties Act, which covers Racing, Poker Machines and Casinos.

3.  Racing is a large and quite complex industry, with three separate codes, numerous individual clubs throughout the country, thousands of employees and registered persons such as Trainers, Jockeys and Drivers who earn their livelihoods from the sport/industry, therefore it needs an element of Government oversight to keep the whole operation broadly fair, and honest.

4.  That oversight is achieved by means of the Racing Act 2003, which at Section 3 states its Purpose to be:-

  "The purpose of this Act is --

   (a)   to provide effective governance arrangements for the racing industry;  and

   (b)  to facilitate betting on galloping, harness, and greyhound races, and other sporting events;  and

  (c)   to promote the long-term viability of New Zealand racing.

 

5.  The NZ Government, as does the Australian, British, French, United States, and plenty of others worldwide, collects taxation in various forms from their racing industries, but they do not own their racing industries.   Our Government is on record as saying that the NZTAB exists for the primary benefit of the NZ Racing industry.

EVERY company in NZ operates under the oversight of the N Z Companies Act, but the Govt DOES NOT own them.  All taxes and duties paid by every company and every Incorporated Society (which every NZ racing club is) are paid by the owners (of companies) and the beneficiaries of incorporated societies.

 

Hope this furthers everyone's education a bit.

 

 

I thought I'd move this thread here to disentangle it from the CEO one.

Agree with most of the points here except I don't agree that the function of the Companies Act is in any way analagous to that of the Racing Act or that the NZRB is similar to a company formed under the Companies Act. They are different beasts. I agree that government does not own companies as you say. They are formed and must operate under the regulation of the Companies Act but can earn revenue as they see fit and do what they wish with those earnings. They are created and operate UNDER the Act, not BY the Act.

The NZRB on the other hand is created directly BY the Racing Act as a statutory body. The Act also dictates how it may earn revenue and how any net revenue must be used, as you point out above Laurie. It also directly monitors performance, licenses it (for free) as the sole betting operator in NZ and gives the government direct control over appointment of directors. This does not happen with companies formed under the Companies Act.

The question of ownership however, seems a step away from the question of relative government assistance for racing between here and Oz.

It is about what the respective governments give and get from racing. My point is that the differential in favour of racing is far greater in NZ than in Oz, albeit in a different form. If you accept that betting duty, GST and other taxes etc. are similar in both places, though from slightly different structures, the primary difference is that the NZ govt. collects no licence fee and no income tax. So, when people read that an Oz government have given some of that back to racing, they fail to understand what the NZ government/taxpayer are already 'giving' by way of the Racing Act.

So, for example, using the 2018 NZRB figures, the reported net operating profit was $155m. If that were in Oz or any other company here, the government would collect say, $50m in income tax from that. Add say a $15-$20m licence fee and you would have a situation similar to Victoria if those amounts were paid to government. Here, they are already given via the Racing Act. In Victoria, the government collects them then may choose to give some of that back to the industry.

If they were collected by government here, then there may be some credible argument on a parity basis to say the government should provide more assistance. However, as it stands, racing here is getting much more in proportion from government than is Racing Victoria for example. So, to suggest otherwise, or say that NZ racing is receiving NOTHING from government is simply rubbish in my view.

Edited May 2, 2019 by curious

[Laurie Sutherland]

2 hours ago, curious said:

 

 

 

 

I thought I'd move this thread here to disentangle it from the CEO one.

Agree with most of the points here except I don't agree that the function of the Companies Act is in any way analagous to that of the Racing Act or that the NZRB is similar to a company formed under the Companies Act. They are different beasts. I agree that government does not own companies as you say. They are formed and must operate under the regulation of the Companies Act but can earn revenue as they see fit and do what they wish with those earnings. They are created and operate UNDER the Act, not BY the Act.

The NZRB on the other hand is created directly BY the Racing Act as a statutory body. The Act also dictates how it may earn revenue and how any net revenue must be used, as you point out above Laurie. It also directly monitors performance, licenses it (for free) as the sole betting operator in NZ and gives the government direct control over appointment of directors. This does not happen with companies formed under the Companies Act.

The question of ownership however, seems a step away from the question of relative government assistance for racing between here and Oz.

It is about what the respective governments give and get from racing. My point is that the differential in favour of racing is far greater in NZ than in Oz, albeit in a different form. If you accept that betting duty, GST and other taxes etc. are similar in both places, though from slightly different structures, the primary difference is that the NZ govt. collects no licence fee and no income tax. So, when people read that an Oz government have given some of that back to racing, they fail to understand what the NZ government/taxpayer are already 'giving' by way of the Racing Act.

So, for example, using the 2018 NZRB figures, the reported net operating profit was $155m. If that were in Oz or any other company here, the government would collect say, $50m in income tax from that. Add say a $15-$20m licence fee and you would have a situation similar to Victoria if those amounts were paid to government. Here, they are already given via the Racing Act. In Victoria, the government collects them then may choose to give some of that back to the industry.

If they were collected by government here, then there may be some credible argument on a parity basis to say the government should provide more assistance. However, as it stands, racing here is getting much more in proportion from government than is Racing Victoria for example. So, to suggest otherwise, or say that NZ racing is receiving NOTHING from government is simply rubbish in my view.

I don't know what rates of Gaming Duty, GST etc apply in Aust but the situation in NZ is that for many many decades there has been a class of organisations officially recognised and approved by successive Govts as NOT FOR PROFIT organisations.   That means organisations which are prevented from paying out any of their profits or surplus funds to members of the organisations.   These include Rugby clubs, Golf clubs, Bowls clubs, Racing Clubs, and dozens more.

These organisations do have to make profits, of course, to keep themselves solvent and able to function, but their principal reason for existence is to provide sporting or social services and wellbeing to their local populations.

In Racing, the TAB was created specifically to handle all the off-course betting on all the racemeetings of all the NZ Racing Clubs.

The TAB< the Racing Board, the three Code Governing Bodies, and ll the Racing Clubs are specifically exempted by the Income Tax Act from having to pay Income Tax.  Likewise stakes winnings are exempt from tax because horse or dog Owners, as a group incur a lot more costs on the way to winning any stakesmoney than what they collect as stakesmoney.    The TAB (Totalisator Agency Board ) exists for the sole purpose as acting as each Club's AGENT to handle the club's off-course betting.    The TAB was merged into the NZ Racing Board by the Racing Act 2003, and the main purpose of the Racing Board is to allocate race dates, to handle the raceday judicial work that might arise, and generally to maintain an oversight of the whole operations of the NZ racing industry.

[holy ravioli]

a profitable business with a viable plan ,should not need Govt leg ups..at least that's supposedly how the 'free market' works!