NEW World Development chairman Cheng Yu-tung has lashed out at a Canadian provincial government over the loss of a lucrative horse race course deal. Mr Cheng, who will meet with British Columbia premier Mike Harcourt in Hongkong at the end of the month, has sharply criticised a decision to snub his company on a C$95 million (about HK$566 million) track expansion near Vancouver. In a letter to Mr Harcourt, Mr Cheng expressed his dismay at losing a 1991 bid to build and operate the track by New World's Canadian land-owning partner, Western Delta Lands. While the premier's office refused to make public the January 1 letter, Mr Tom Johnson, president of Western Delta, said he and Mr Cheng view the government's decision as an ''extremely regressive step'' in relations between the province and Hongkong. ''If the decision stands, the government will be hard pressed to attract investment from Hongkong,'' he said. ''The province is taking a short view on the matter.'' Before his election to office in 1991, Mr Harcourt had blasted political foes for giving the race track deal to New World, suggesting the contract had been landed in an underhanded manner. In November 1991, after only two weeks in office, Mr Harcourt was invited by Hongkong tycoons, including Mr Cheng, to the territory to calm fears about a proposed 7.5 per cent corporate tax and about important land deals, like Mr Li Ka-shing's Concord Pacific Place development and the race track. He reassured Mr Li that his development was a ''done deal'' and suggested to Mr Cheng that he would probably get the go-ahead because of the British Columbia Racing Commission's decision to award the track to the New World group. While business groups applauded the premier's pro-Hongkong approach, his larger, mainly labour-based constituency began to accuse him of selling out to out-of-province interests. But with the provincial government now set to expropriate the track from the City of Vancouver, and effectively turn its back on Mr Cheng, the local business community is speculating that the premier may have some sort of compensation deal in mind for New World. Mr Harcourt's decision against New World comes as he plans to implement controversial new labour codes. While the labour movement lauds the proposals, the BC Chamber of Commerce and banking representatives with operations in Hongkong consider them ''anti business and pro-trade unionist''. The tax on capital introduced in BC last April also has Hongkong companies like Cathay Pacific worried about the rocketing costs of doing business in the province. ''My first indication is that we are not exempt from these taxes,'' Cathay's president of Canadian operations Mr John McCulloch said. ''Our accountants are now looking at whether our aircraft can be taxed as capital while they sit on the tarmac for two hours a day. An enormous surtax on fuel already makes Vancouver one of the most expensive places to operate from.'' Some business representatives who accompanied the premier on his 1991 visit to Hongkong are threatening to boycott his trip this month, saying that Mr Harcourt will have to ''concentrate more on damage control than promoting business.'' A preliminary date for his arrival is January 25. He is scheduled to meet with government and business leaders.