SBC News Travsport purposes counter tax measures to save Swedish racing 

Travsport purposes counter tax measures to save Swedish racing 

The board of Svensk Travsport, the organiser of Swedish trotting, will present a counter-proposal on gambling taxes to safeguard the future of horse racing in the country.

The statement was made by Travsport Chairman, Anders Källström, who detailed anxieties about Swedish racing being lumped into a generic tax band for gambling in 2024.

As announced at the end of 2023, the Riksdag will vote on increasing Swedish gambling taxes from 18 to 22% as proposed by the 2024 Budget.

If approved, the tax rise will come into effect from 1 July 2024, as the Finansdepartementet, Sweden’s Ministry of Finance, seeks to raise a further SEK 550m (€50m) from gambling duties.

In a column for Swedish racing news source Travronden.se, Källström urged MPs to consider the impact of tax increases on Swedish racing’s value chain of stakeholders: “Around the country’s 350,000 horses, a sector has emerged that annually provides up to 20,000 people with full-time employment and a turnover of tens of billions of kronor.”

The well-being of Swedish racing is directly linked to the income generated by the totalisator network of Aktiebolaget Trav och Galopp (ATG), whose profits – vital for the industry – amounted to SEK 2.3bn (197.5m) last year.

The government’s proposed tax increase could lead to a reduction in operating contributions by more than SEK 200m (17.1m) annually, triggering the closure of racetracks and may necessitate cuts across the industry, affecting everyone from horse owners to employees working in rural towns.

Källström noted: “The now proposed gaming tax causes the clouds to gather in the trotting sky. The planned tax increase from 18% to 22% will be an additional burden.”

The Swedish tax committee should reconsider the proposal in light of its potential to damage a traditional industry and its broader implications for rural employment and economic stability.

“Four percentage points doesn’t sound like much, but it’s a sudden tax increase of over 20%. In kronor and öre, this corresponds to a reduction of ATG’s contribution to equestrian sport by more than 200m annually.”

As such, Travsport has proposed maintaining the tax rate at 18% for racing and sports betting, whilst increasing the rate to 26% for casino games.

Källström cited that Swedish racing had been caught in the crossfire of regulating casino games as the Swedish gambling sector’s most harmful vertical.

Travsport’s Chairman calls on Swedish MPs to omit racing from the current plans to increase taxes, in which the organisation will work with Skatteutskottet, Sweden’s tax committee, on a new proposal.

“With the greatest respect, we urge the members of the tax committee in Sweden’s Riksdag to carefully evaluate the consequences of their decision,” Källström concluded.

“Our hope is that the facts, combined with an understanding of the importance of the Swedish horse industry, will make the members choose a different path than a general tax increase that will hit a single industry very hard and cause damage to something that has taken decades for people – and horses – to build up.”

 

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