COMMUNIQUE: Rs 1 billion in additional betting taxes?…

by | Apr 20, 2021 | Hippisme

A Letter has been sent to the Honourable Minister of Finance by MTC Sports and Leisure Ltd (MTCSL) containing certain recommendations for inclusion in the 2021/22 budget. Please find the wording of this communication below.

Rs 1 BILLION IN ADDITIONAL BETTING TAXES??
An independent report produced by Ernst and Young estimated that in 2018 the horse racing industry was responsible for generating Rs 6,2 billion in GDP, creating 2170 jobs (equivalent to Rs 2 billion in labour income) and generating Rs 679 million in Government revenue. The vast majority of the Rs 679 million accruing to the Government was in the form of Betting taxes.

Estimates are that the illegal betting market is at least as big as the legal betting market but more than likely two or three times bigger. In the opinion of MTC Sports and Leisure Ltd (formerly the Mauritius Turf Club) a significant amount of the illegal betting market could be brought into the “legal betting net” by implementing tried and tested betting initiatives used all over the world. This could yield an additional Rs 1 Billion in additional betting taxes, maybe even more. The following serve as some examples of what could, and should, be done in order to address the huge illegal betting problem in Mauritius.

• Embrace technology as both a bet monitoring system as well as a betting medium.

• Legalise internet betting within Mauritius and stop foreign websites offering bets to Mauritian citizens on both local and international races.

• Introduce credit betting, or at the very least permit debit betting.

• Re-introduce off course bookmakers.

• Expand the off-course tote infrastructure.

• Lower betting taxes. The Laffer curve principle applies to betting on horse racing, just as it does for income tax. Lowering betting taxes will result in
increased total tax revenue.

• Significantly increase the effectiveness of the Police Des Jeux in the fight against illegal gambling.

• Make examples of illegal betting operators through severe sanctions and jail time.

• Review fixed charges payable by licenced betting operators. The higher the cost of being legal, the less likely operators will choose to operate legally.

• Strictly monitor legal licenced bookmakers to ensure that all bets are placed through legal channels.

Authorising international co-mingling and betting on foreign racing will not only generate significantly higher taxes within Mauritius but it will also result in foreign revenue flowing into the country. Provision has been made in the GRA act for comingling to take place but to date this internationally accepted practice has not yet been authorised in Mauritius. Co-mingling has been an international norm since 2007 and currently constitutes more than 20% of global tote turnover. Why not in Mauritius??

MTC Sports and Leisure is of the opinion that there is no need to “re-invent the wheel” in order to raise significant additional tax revenue for the Mauritian fiscus. Proven international best practice initiatives need to be adapted for local conditions and implemented without any further delay. Not only will the Government benefit by addressing illegal betting practices but horse racing, which depends on legal betting for its very survival, will remain sustainable and potential will exist for future growth.

MTC Sports and Leisure Ltd

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