GST hits horse racing, Hyderabad Race Club turnover down by three times

By Anurag Mallick  Published on  18 Feb 2020 5:02 AM GMT
GST hits horse racing, Hyderabad Race Club turnover down by three times

Hyderabad: The GST, introduced from 1 July, 2017, has hit horse racing leading to losses for race clubs. Hyderabad Race Club president, R. Surender Reddy, said the Hyderabad Race Club's annual turnover was down by three times after the implementation of GST.

Speaking to NewsMeter, he said "Before GST came into play, this is just an example, we were paying seven per cent tax. Our yearly turnover was Rs. 1,275 crores. After the GST came into play, it slowly started coming down. Today, unfortunately, it's Rs. 460 crores. Now, our expenditure has gone up. Stake money is more or less the same. But when you see the crowds, it's the same. On a normal day, it was around 8,000 people. Even today, it's 8,000 people."

He said, "They're all coming to bet. Where is the money going? It's not coming to the official racecourses. It's all going to illegal betting. We have also brought this up to the notice of the government. Now when it comes to cricket, the turnover in any T20 match is Rs. 4,000-5,000 crores, which is not a small amount."

Mr Surender Reddy further said, "What does illegal betting lead to? It's leads to mafia. Dons are born overnight. If only the government would take control of the game, it would not only help the government, it would help the people."

In June 2019, an association of six race clubs across India, Turf Authority of India (TAI), had urged the Centre and states to rework norms applicable on horse racing. It had further suggested to levy GST only on the service charge or commision which the race clubs retain and exclude the prize money awarded to the winner. Declaring horse-racing a skill of game rather than a skill of chance, the association also urged for a lower GST rate of 18 per cent rather than the prescribed 27 per cent.

The GST on placing a bet on horse racing is 28 per cent as the punters place a bet during horse racing. This, in turn, is a big loss for all the punters as GST is levied on the total value, which even includes the commission retained by the race club. As the punters don't receive the desired outcome, this further leads to illegal betting, thus causing losses to the race club and the government.

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