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Fair point Sam , and you could be right , but the only level playing field will be a tote monopoly , and its kinda hard to see that happening
Totally agree with the mid week betting shop punters comment . hard to see how anything will change as long as the levy / bookies collection / donation scheme is in place
cheers
Ricky
Winning punters on the exchanges contribute to the levy
Winning punters on the books drain the levy
Therefore winners who care about racing use the exchanges
Those rather pompous words aside, to say that my preference for the exchanges is due to anything other than self-interest would be a hypocritical lie
know thyself
….benefit of the Exchange players, ….whose only contribution back into the sport is via the "Voluntary Contribution".
Not sure what you mean here BSB, but I’m pretty sure you don’t as well.
Betfair pay the Levy at the same rate (10% of Gross Profit from British Horseracing Business) as every Highstreet Bookmaker. The ‘Voluntary Contribution’ made by Betfair is from the gross profit made from non British horseracing, unlike any other Highstreet bookmaker that makes no such contribution.
Go figure….
Pompete, however you dress it up, Betfair layers and Bookmakers don’t contribute to the Levy on an equal footing.
BSB, there is no dressing up they (Betfair) pay at the same rate 10% of Gross Profit….but I accept the point made about Layers…
Pompete, they may pay at the same rate but they operate in such a different way that the comparison is meaningless. Bookmakers pay 10% of their gross profit on their bookmaking on British racing. Exchanges pay 10% of the commission that they generate. That commission though is a fraction (2.5%, 3%)of the gross won on any race by their customers. Given overrounds of 1 or 2% per event the gross win per event is at a low margin which in turn is charged a commssion of a few percent, which in turn is subject to a 10% levy.
It’s a comparison between apples and oranges. 10% of a bookmakers winnings compared with 10% of 2 or 3% of the winnings of exchange customers operating with no tax, no levy and no gross profits tax overheads. Don’t forget that any licensed bookmaker putting any business through an exchange has to run all of that through his corporate and levy books too.
If you doubt that there is a very small margin there in terms of levy return, consider the ability of Betfair to levy (and their relevant customers ability to pay) a further 20% tax on profit in the form of the premium charge.
A fairer comparison would be if we all were charged a 10% levy on our horseracing profits on exchanges but if that happened the exchange model would look very different.
I’m not criticising the exchanges here, they are private corporations who are going to do everything in their power to maximise their profits within the existing rules, just like the bookmakers do.Sean, I accept the point you make and agree however my post was in response the idea that BF only contributed a ‘voluntary’ contribution the levy.
Whether as your post argues the actual contribution from BF is equitable or not is for others such as yourself to debate. Personally, if Dusty Spirit don’t win the 4.55 at Bath I’ll have to explain to the mrs why I’m not taking the out for Sunday dinner
Sorry Pompete, didn’t mean to lecture! You’re right of course that Betfair pay on their offshore business and have also made substantial contributions in Ireland. They have in many ways gone beyond the letter of what they need to do legally. I do also understand though why bookmakers don’t like being told that Betfair pay at the same rate as them.
Have a nice dinner!Dont worry Anthony , you can always reverse the trend and go down to the bookies and blow your cash with them
if that makes you feel better , at least you know to whom you are donating …and you become a loyal and trusted levy contributor
we need more of those !!!
Ricky
Which would be fine except that I don’t ‘blow’ my cash anywhere, I’m doing quite nicely & even if I wasn’t, a loser is still a loser so it’s not like I’d better off.
My point is, a layer on the exchanges is putting far more of his or her neck on the line.
In the midst of arguing… a serious question: Can horses only be backed one at a time on the exchanges? There’s nothing like a Yankee or anything is there?
So we’re agreed then that in reality, the only contribution that the layers make
is
via the Voluntary Contribution ?
Betfair might pay it, but let’s be honest, it’s all designed to keep the Government wolf from the door.
If the layers start being subjected to the same levy that the high-street layers are, then Betfair’s slice of pie starts to shrink.
To use Sean’s analogy, it’s time for us to compare apples with apples.
Sam , dream on . its not even remotely likely that your scenario will ever happen
Exchanges are here to stay , not until the Tote becomes more attractive to punters will there ever be any change , and that seems like a light year away
The real question is , how long more will the bookies tolerate the levy , and what will happen if they just say no thanks we are not bothered with Horse racing any more
Now thats a poser to think about
Ricky
http://www.hblb.org.uk/sndFile.php?fileID=47
If the bookmakers don’t want to pay levy, then we’ll find some other way of funding the sport, Ricky. Its no big deal. I see no reason why they wouldn’t want to pay it though: They pay relatively little.
Yet in 2008/2009 off course bookmakers paid £81m in levy.
Betting exchanges paid £6.2m.
Its not enough, Ricky. Simply not enough. Dress it up how you like, spin it like a top, but £6.2m is not enough for horse racing to survive.
Not when you consider how much Betfair paid for TVG in 2009. Nor the costs of their increasing activities in Australia.
You might make snide remarks about "levy contributors" like myself – I ceased using exchanges in October 2008 and won’t go back – but if horse racing was reliant on betting exchanges for income, then the sport would be in dire straits. Horse racing would eventually return to its origins as a sport for the rich, where horses race for stakes and private bets.
The levy is an instrument which allows
everyone
to enjoy a day at the races; not just rich men, while the rest of us look through frosty windows at the horses riding by.
Also the figures don’t take into account
Opportunity Cost,
an old economic concept whereby a consumer has a pound to spend and can buy either a slice of pizza or a chocolate bar, but not both. Exchange punters tend to stay betting on the exhanges. You could argue that exchange betting money is lost (or at least 1/1 x (81/6)) is lost to horse racing.
Neither the bookmaker contribution nor the exchange contribution is satisfactory to me and in my opinion the sport is worth much more. But I know where – all other things being equal – my pound is better spent if I want to continue to watch thoroughbred racehorses race.
Little did I know until just now but Opportunity Cost is what’s been informing my betting for the whole time I’ve been at it. My one unbreakable rule:
Don’t spend more in the bookies than you would spend at the pub in the same period of time.
And I’m not a big drinker.
Max as always very considered
I wont argue the toss , all I will say is this
The levy does not work , scrap it
Get a tote system to work , even get betfair to operate it
Scrap the racing programme , the senior handicappers , and start again
less racing , more quality and loads of condition races
Forget the bookies and Betfair , they have bigger fish to fry ..in Betfair’s case Usa , uk racing will be a bit part soon
Make racing accessable for Joe punter at prices he/she can afford without feeling ripped off
Am I dreaming this stuff ….
Ricky
You might be dreaming about Betfair USA as online gambling in the USA is still illegal I think.
Surely, it’s time for Betfair to open some shops? Two queues: ‘Roll up, roll up. Backers on the left, layers on the right.’
If they’re so great, let’s so how they’d work out there in the big wide world.
They pay relatively little.
Yet in 2008/2009 off course bookmakers paid £81m in levy.
Betting exchanges paid £6.2m.
Its not enough, Ricky. Simply not enough. Dress it up how you like, spin it like a top, but £6.2m is not enough for horse racing to survive.
.‘Relatively little’ yes but these figures in isolation tell us little. A small fish is relatively little in comparison with a big fish
The minnow can only regurgitate a fraction of the food the pike can
Unless weighed against Turnover and Gross Profit who is to say who’s paying a ‘fair’ levy and who’s not
Whilst realising that leviable GP from exchanges is calculated in a different manner to that of the off-course books as the business model is different, if we accept your figures as strictly comparable: GP levy from the books appears to be ‘only’ 14x that of the exchanges.
Is this a reflection of the exchanges’ market share?
My preference for the exchanges does not mean I’m apologist for them and I’m inclined to agree that they should cough up more, but until someone can supply all the relevant figures rather than just the net-end it can be no more than an inclination
And given that the books seem to be growing less and less bothered about racing, who in the future is more likely to be willing to stump up levy, or ‘son of levy’?
I’d suggest racing is more important to the exchanges than it is to the books
You’re right, racing on the present scale cannot survive on the Blue and Purple donation of 6.2m
Tote Exchange step forward
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