Racing under the radar
Despite having a more than a century-long presence in the mass media, horseracing remains under the radar of the majority of Filipinos.
Yet in 2014, the Philippine Thoroughbred industry earned P8.22 billion in gross sales from betting handle, employed 6,165 people, and remitted P1.44 billion in direct taxes to the government, not counting indirect taxes.
Industry investors, from horseowners to racing club owners, have poured an estimated P5 billion pesos into Thoroughbred livestock and racing operations and breeding infrastructure and technology. The sport’s events have raised champions whose track times are close to matching those posted by stakes winners abroad.
However, the industry faces constraints from external and internal factors leading to a downtrend in recent years. To turn this around, the industry’s regulatory body, the Philippine Racing Commission, and the industry’s various sectors – horseowners, racing clubs, jockeys, trainers - are pushing for a law that will give the agency a better capability to help address industry issues.
Yesterday, without fanfare, House Bill No. 4474 was taken up for deliberation in a public hearing of the Senate Committee on Government Corporations Public Enterprises, chaired by Senator Cynthia Villar.
Among the issues raised by members of the industry was the need to rationalize racing taxes. Racing is the most taxed form of gaming, with taxes levied on bets, winnings, and track income. Historical sales data show that the lower the taxes on racing, the higher the sales, leading to higher prizes and government revenue.
Villar, the only senator present at the hearing, requested the industry to submit a comparative analysis of taxes imposed on local gaming operations – racing, Lotto, casino, and the like - with a view to addressing this concern.
She also inquired into the livestock aspect of racing, particularly the National Stud Farm that is under the Bureau of Animal Industry. The NSF was established by Republic Act No. 4618 in 1965, and during its heyday provided at little or no cost the stud services of Thoroughbred stallions to racehorse breeders and to farmers.
According to BAI’s Dr. Gilbert Bolo, in 2000 the budget for the NSF was P9 million. There is presently no budget allocated to the NSF, which has been inactive for about a decade.
The senator told the racing industry, “You are not the only ones complaining” about the lack of livestock, adding that with the various efforts of livestock development scattered among different government agencies, the country has “failed” in the development of its livestock program. For instance, the country produces “only one percent of its consumption” of dairy products.
“We are studying whether this should it be centralized – sa ngayon kasi, iba ang sa goat, iba ang sa carabao.”
She said she is amenable to providing a P10 million budget for the BAI to buy stallions for a reestablished stud farm.
It was also at the hearing that the senator heard for the first time about illegal bookies in racing, and asked how their operations could be stopped.
Philippine Racing Club, Inc. EVP and CFO Allan Abesamis said, “Illegal bookies are the industry’s number one enemy. If they eradicated, the concerns of horseowners about low prizes and racetracks about income will be solved.” It is estimated that the sales of illegal bookies are the same as that of the racetracks.
Games and Amusements Board Commissioner lawyer Aquil Tamano admitted that GAB, which supervises the betting aspect of racing, is also mandated to police against illegal bookies. However, they are hampered by lack of manpower and arms.
“We were initially given a police force by the DILG (Department of Interior and Local Government),” he said, “but this stopped in 2004.”
The senator is receptive to reforms and changes in the racing industry - “We will touch on taxes and horse prizes” - but she does not seem inclined to change the nature of Philracom to that of a GOCC as HB 4474 seeks to do, reasoning that whether “the name is changed” other things remain the same.
“We have to fix how we do things, identify problems, and come up with strategies to address them… We’ll do something for the revival of the industry.”
Perhaps this time, with the support of Senator Villar, the often-overlooked racing industry will finally get the legislative makeover it needs to make it more responsive to changing times and circumstances.
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