Rt Hon Winston Peters
Minister of Racing
MEDIA RELEASE
Racing Finally Gets a Fair Deal
Legislation in Parliament next Thursday – Peters
The 2006 Budget will contain a long awaited fair deal for the racing industry with a reduction in gaming duty for racing and an accelerated write-down regime for bloodstock, says Racing Minister Winston Peters.
Mr Peters made the announcement at the conclusion of Auckland's Racing Carnival Week.
"2006 will be a watershed year for the New Zealand racing industry, and will mark the end of years of unfair treatment.
"These changes meet the commitments made in the NZ First Supply and Confidence agreement with Government and will be part of Budget 2006. They come into effect with the new racing season on 1 August 2006," said Mr Peters.
The key changes will be:
- A reduction in totalisator duty from a headline rate of 20% down to 4% of gambling profits (amounts bet less amounts paid out);
- A decrease in the write-down period for stallions from 4 years to 2 years;
- A decrease in the maximum write-down period for broodmares from 8 years to 5 years (or 6 years for those few broodmares that commence breeding at age 2). Broodmares that commence breeding at age 8 and over will be written-off in full in the first year of breeding.
- Work in progress so Bloodstock sold for export may, at the discretion of the Commissioner of Inland Revenue, be zero rated for GST for up to 2 years
Reducing totalisator duty to 4% will align racing's gaming duty with that of casinos – the fairest outcome – and accelerated depreciation on bloodstock will make the purchase of bloodstock more attractive. Both will significantly improve the economic potential of the racing industry.
Currently the racing industry directly contributes $424m to GDP and sustains 9,248 full-time equivalent jobs while generating more than $130m in export sales.
With the government now providing a level playing field, the racing industry now has the chance to build on the New Zealand Racing Board's plan to bolster the industry's economic contribution.
"We are hopeful that those parties who during the election campaign recognised the unfair regime racing was operating under will now make good on their campaign promises and back these changes and the associated legislation.
"Racing has been waiting for a fair go for decades, and it is pleasing that as early as next Thursday legislation will be introduced to be able to deliver it," said Mr Peters.
The Bill is titled 'Taxation (Depreciation, Payment Dates and Alignment, FBT, and Miscellaneous Provisions) Bill'.
ENDS
For more information contact:
Allison Jones
Private Secretary Racing
(04) 471-9490 or (021) 610-855
or
Sophie Lee
Media Officer
(04) 471 9606 or (021) 994 400