New Jockey Club chairman gets straight to tax
Newly elected Hong Kong Jockey Club chairman Brian Stevenson was straight on the front foot regarding taxation issues last night, even as the club announced record contributions to government and charities at its annual general meeting.
Tax and betting duty payments to the government for the year ended June 30 totalled a record HK$13.62 billion, up 5 per cent, while donations to the community and to charitable projects were also up 11.2 per cent to HK$1.52 billion. And duties on football betting paid to the government increased 10.6 per cent to HK$3.21 billion.
'I'm exceedingly honoured to become chairman,' Stevenson said. 'I'm well aware of what the Jockey Club means to Hong Kong - our contribution to society, our contribution to charity, to major projects like the equestrian Olympics. It is a most wonderful model.'
But Stevenson said rates of taxation imposed on the Jockey Club were 'severe' compared with other racing jurisdictions.
'Five times the tax in the UK and three times the rate in Singapore. And that gives illegal operators more chance to operate in this market than elsewhere,' he said.
He added that tax issues were also preventing Hong Kong from participating in a global swing to 'commingling' (a process in which bets placed legally on Jockey Club races by punters in other countries would be funnelled into local pools).
'Hong Kong is missing a great opportunity in an area where we should be leading the world,' he said. 'It was our idea and we took this to the international racing authorities, and now it is being done by others and we are not free to join in. I hope it's one thing where we can make progress.'
Tax was at the forefront of departing chairman John Chan Cho-chak's speech, too, as he said that the 5.9 per cent financial year turnover rise for the club's core horse-racing business to HK$71.65 billion 'did not tell the full story'.
'In reality, the club's share of gross margin on horse racing has shown no overall growth of significance since a package of betting duty reforms was introduced in 2006, while the government's share has risen over the same period by some HK$730 million,' he said.
'In other words, while the reform package has been successful in its goal of luring back revenue from illegal operators, the benefits have not been shared equitably. This is an issue that needs to be addressed in the coming years through a comprehensive review of the existing taxation framework.'
Stevenson said he had joined the Jockey Club in 1974 and had always admired the role the club played in the community.
He said he would inherit a club in 'very good shape' and foresaw no change in direction.
'John Chan has made a wondrous contribution during his four years as chairman and 17 years on the board,' Stevenson said.
'I have been on the board for 12 years and participated in decisions that have brought the club to where it is, so my work is a continuation of that.
'Our biggest immediate goals are a successful conclusion of the Asian Games equestrian events, and the establishment of the Conghua training centre [near Guangzhou].'