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18% Gst Could Kill Racing, Fear Clubs

By Doorstep | 14-Apr-2017
18% GST could kill racing, fear clubs
Shailendra Awasthi
|TOI Mumbai|

The biggest setback will be felt by the Mysore Race Club (MRC), which pays just 4.5% tax at present. A jump of 13.5% is likely to sound its death knell as it has no other source of income to run its operations, which include expenses on stakes money and administrative costs.?The tentative tax of 18% on horse racing, as proposed by the Goods and Services Tax (GST) council recently, could destroy the king of sports in the country . Though various racing clubs across the country currently pay varied rates of betting tax to their state governments, a common tax of 18% is bound to have a cascading effect on betting collections and inter-venue royalties.

The next big loser will be the Bangalore Turf Club (BTC) which currently pays 8%. A 10% increase will see lower dividends on Tote betting to punters who are likely to shy away from betting, resulting in a significant downfall in BTC's collections from around Rs 2,000 crore at present.

The betting volume at other clubs like Royal Calcutta Turf Club (currently 5% on win and 10% on other pools) and Hyderabad Race Club (15%) will also be hit.

It has to be noted, that apart from the betting tax, winning punters have to pay TDS on earnings beyond Rs 10,000.

The 18% may not sound too big for the Royal Western India Turf Club, which has a 20% tax burden now (with bookmakers it is 30%), the Madras Race Club (25%) and the Delhi Race Club (20%), but inter-venue royalty (the sum that clubs pay each other for accepting betting on that particular club) could take a significant hit. Vivek Jain, the chairman of RWITC which oversees racing in Mmbai and Pune, admitted that despite the fact that the club already pays 20% to the Maharashtra government, the uniform rate of 18% will affect racing badly. “If 18% is bad for others, it is bad for the industry overall as we take each other's betting,“ Jain told TOI on Thursday .

Jain is also the head of a delegation of Indian racing's umbrella body , the Turf Authorities of India (TAI), which will meet the GST Council to pursue it to bring down the proposed rate of tax.“We will meet the secretaries of the GST Council in Delhi this month before the rates finalisation meeting in Srinagar in mid-May . We will stress on the objective to bring down the incidence of illegal betting and cashless systems which only lower rates of tax can achieve,“ Jain said.

Jain also revealed that the TAI delegation is in the process of drafting a new representation incorporating details of GST calculations by other countries. “We are also analysing tax rates and tax collection by different states as part of our submission,“ he added.
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14 Replies

Srinivasan said ...

17-Apr-2017
The best way to contain Bookies malpactice of 10% or 12%, Accept the bet like tote and if the punter wins deduct hole tax (GST + Commission) and punter looses let the bookie pay the tax.
In this way the club can avoid half tax principle and bookies can accept even small amounts.

Kolramsri said ...

16-Apr-2017
Thank you Raghavan for acknowledging my post. Hereafter I will read before I submit.After 1986 I completely stopped even to look at the Madras Race Card. So no idea at all. Even M.A.M would not have bet on 80 % Races. I laughed at my folly.

Raghavan said ...

16-Apr-2017
Thanks a lot Kolramsri jee.

I know it is not possible for any punter to bet on 80% races, that too 10k! So, your post had really confused me.

Of course there are some bettors here who bet any amount 100 to 500 on practically every race and relatively higher bets (2k & higher) on horses that they strongly fancy.

Good discipline. 40 horses a season means less than 1 bet a day or 5 bets for 4 days. Keep it up.

Raghavan said ...

15-Apr-2017
@kolramsri,

Thanks a lot for your clarification. Was really confused. It is outright impossible to bet in 80% of races for any punter; whatever may be his dynamism!

Good discipline. 40 races in a season works out to around 1 bet a day or 5 bets in 4 days.

Did you tried your skill in the just concluded Chennai races? Any notable performaance?

Good luck.

Kolramsri said ...

15-Apr-2017
My friend told me, I gave a wrong impression that I played ( place bets) nearly 80% of races conducted by the Race Club. It is not so. . What i wanted to convey was 80% on place 20% on win. Being selective, total number of bets may not exceed 40 races per season.

Shaps said ...

15-Apr-2017
Big punters always play with the bookies.Reason they get much more than what they would get at tote. And it makes a lot of difference.

After all, punters go to races not just to watch races or coffee breaks, but to play and try to make some money.

Win or loose is part of the game. This only the experienced ones will understand. For one, myself will always play with bookies come what may or what may be said.

Kolramsri said ...

15-Apr-2017
Raghavan.....It is not luck..It is knowledge (patience) acquired after losing large portion of my earnings in all gambling activities. Because of my family support, i still indulge in , what is So dear to my Heart ....GAMBLING.

Raghavan said ...

15-Apr-2017
@Kolramsri,

One of the very few lucky ones. Betting tax free. Let the current arrangement run indefinitely.

You are telling 10k place bet on nearly 80% races. Big salute to you. I may need 10 janmas to reach that level. Best of luck.

At BNG also, there was a man who was betting 5k to 10k with bookies. Zero tax if the bet fails. And 10% if the bet wins. So among bettors, there are instances, unknown to us, where some punters are getting good concession.

@stop fooling punter,

Even though I agree that my racing knowledge is zero, I know this much.

It is the bookies who are killing the sport. Not the authorities. At least I am not agreeing that authorities are alone responsible 100%. Let us not downplay the bookies' role. This gst will be one more nail in the coffin of the King's sport.

@srinivasan,

The bookies are in vantage position. A large section of tote players will migrate to the bookie's side. you may feel it strange. After demo, there are occasions when I felt some sympathies towards the bookies. They had huge cash pile thanks to the 10% they collected during last 8-9 years. Entire transformed to toilet paper overnight. And, when they tried to resume their profession, the btc said "get lost". Now, they are trying to recover whatever possible at Mysore. So in this context prefer not to rub mirchi in their wounds.

But no amount of punishment is sufficient to those who were too arrogant to take bets of 500s, 200s etc even when the punter was ready to pay 30%. They ran the show successfully over a long period of time. Full support from all the authorities. The authorities displayed shockingly low level of conscience by allowing them to take 10% bet. So, in my assessment 20% blame on authorities and 80% blame on bookies.

And, to the shock of all punters, these bookies have displayed their monsterous face on 2nd April. They allowed bet on 4 races. All won by favorites. And, seeing the possibility of favorites winning spree continuing in other three races also, they simply closed the shop. These bookies who had looted the punters, cheated the club, cheated the Government for years together were shameless enough to not take any bets in the 5th, 6th & 7th races just because races 1 to 4 went against them. .

Bookies en masse closed the shop in 3 races. Some years back, the bookies went on strike at bng because an Income tax officer raided their premises/office. When will the punters try to demonstrate their will power to the bookies?

Even then, our punters are loyal to bookies only. A good number of them might have now gone to Himalayas to do their tapasya to bring back the bookies to bng. O K. Bhagirath was succeessful in bringing Bhageerathi. Let us see how for these punters tapasya will be answered by the Almighty.

Ganesh said ...

14-Apr-2017
mumbai tips-1-4win conform, 2-1conform win, 3-7win, 4-6plc, 5-3each way, 6-3and 13are good , 7-3conform win, 8-1each way  days best 2-1

Kolramsri said ...

14-Apr-2017
For me no prob..whether ninety or nil%. Every season I might have entered Guindy around 3 or 4 times. Bet with my book maker, sitting at home or Club minimum 10k over Phone . I play nearly 80% races Place bets.More than 90 times it will be evens and less.So no tax at all . Only time I paid 10 % tax was on Baracchus (2 1/2), when it finished second to RAFA. Because of A. Sandesh I played. This is a rare case for me.

Stop Fooling Punter said ...

14-Apr-2017
Racing will be killed by the persons in athy and not thre GST.

North wise Delhi less said the better the same person holding power of attorneys for the alst 10 years now thrusting his son.

Cal Cyrus Maidan saved Cal racing but once going dumped nw p[lease do not laiugh 3 traienrs are running CAL

Mum the chunnu munnu jodi in power by rotation has sounded the death knell of Mum racing. Pray how amny punters attend only Members.

Hyd The chairman is his late 80s still does not want to give up power.In spite of having exellent punters and small time owners.too much manupilation.

BNG As they say luck favours the brave. Case listed in 2019 for lease renewal.
A good center still being run by some outsiders ,will be badly hit,ban on Bookies will have to be changed.

Mys Too many horses owned by bookies,Inspite of many saying. NO KYC done on owners at all.

Chennai will survive on other income,

So guys no doubt racing will be hit but gamblers will rule the roost.

Un authorised bookies will rule the roost in every center.

Racing will carry on wih a minor set back ass in Nov /dec

Raghavan said ...

14-Apr-2017
@Doorstep,

Seems you are well aware of the tax slabs prevailing across all the turf clubs in the country. Such data will always help punters to make a clear analysis of the fallout of new tax structure and also have a clear idea regarding the pros & cons of new tax slabs.

If 18% gst & 5% club charges replace the existing tax/commission slab, then certainly the win, shp & place dividend will take a beating. Hope the Club management will be at their persuasive best in convincing the Government not to kill the goose that is laying the golden egg daily.

The club has to find a way. Not an easy thing. Once the Government decides, then it is rather unrealistic to expect any kind of roll back.

Of course the new gst recommended by the Governing Council is a welcome relief to the winners of jp/treble & sjp pools. (sjp only at rwitc).

Still 76 days away. Let us wait & see.

Srinivasan said ...

14-Apr-2017
If you are betting with bookies it doesnot matter because you will be paying half tax.

In Bengaluru, at present tote tax including club commssion is 12.5% (7.5 + 5)and if GST is 18% tote pay out may reduce by Rs. 3/- because total tax on becomes 23%.
With bookies the total tax becomes 23% (Club commission 5%) if you play below 1000/2000.

Confused P said ...

14-Apr-2017

18% of the collection is to the Government. Add to that the club commission which is what the Clubs survive on. If the slab is 18% then for the punters it will be minimum 22% assuming 4% club commission, upper is anybody's guess.