Racing industry should pay its fair share of tax

Last updated 17:38 09/03/2017

"As we watch our retirements and chances of home ownership slip away, NZ is funding a cruel and pointless industry."

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As an animal welfare advocate I've had my eye on the greyhound racing industry for quite some time. Part of that is following the money, and there's lots of it.

For historical reasons, the racing industry is an old friend to politicians. It's that old friend from high school you have on Facebook - the friend you don't really talk to anymore and have nothing in common with, but there is some history, so you let them stay.

In the olden days, politicians attending races was probably commonplace - whereas today, racing is old tech. Now we have televisions, computers, movies, the internet, other sports that are actually sports, and no end of more interesting and more ethical things to do with our time.

Racing is so 1900s.

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But somehow, racing still enjoys the legislative benefits of yesteryear, including broad preferential tax treatment from the IRD and the Government.

Despite being a financial giant, and in spite of its ethics and animal welfare problems, the racing industry has tax loopholes you could drive a bus through.

From top to bottom the racing industry is tax-exempt:
* The New Zealand Racing Board
* New Zealand Thoroughbred Racing
* Harness Racing New Zealand
* The New Zealand Greyhound Racing Association (Incorporated)

About 150 racing clubs enjoy tax-exempt status. Every cent of prize money is exempt from tax, too.

So there are tax breaks all through the industry. All for entertainment, for putting animals in harm's way, and for providing little more than degenerate vice. Rewards, while many others struggle to get by.

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Not to mention the pub charity merry-go-rounds and the Government's million-dollar Racing Safety Development Fund perk, because apparently, despite having turnover of $2.7 billion, the industry always comes up a bit short when it comes to safety and needs the taxpayers to put in for that every six months.

But it gets worse. It turns out you can be a trainer or owner of racing animals and not only is the stake money you win tax-free, but it won't actually affect your entitlement to a government benefit.

So you can be on the dole - regularly taking home hundreds or thousands of dollars, even of race winnings - and under the current law you are still eligible for the unemployment benefit. This is 100 per cent legitimate double-dipping.

You may think winning races is such a rare and lucky thing it doesn’t warrant attention, but hundreds of races are won every week, and in the 2016 racing year, more than $136 million was distributed in prize money. For those with hundreds of greyhounds, for example, this is regular, predictable, tax-free income.

The rest of us watch our retirements slip further away for economic reasons and home ownership is harder and harder to come by as a life achievement, yet we're simultaneously subsidising a cruel and pointless industry, where people can pocket some serious big money, skip the tax, and yet are still eligible to collect a benefit.

So forgive me for stating the obvious - and I am coming from a biased point of view, because the ongoing slaughter of slow greyhounds in particular makes me feel a bit sick - but how exactly is this fair?

Sally is Aaron Cross' greyhound. "She's 7 and melts hearts."

A questionable industry with grave animal welfare and ethics problems, raking in the dough at the rest of our expense, when hardworking people in more legitimate occupations are powerless as they watch life's goalposts move further and further towards the horizon.

Surely a fairer tax contribution from the racing industry would be useful when budgeting along with everyone else's taxes?

If your income was tax-free, wouldn’t that make your life easier?  It's probably hard to imagine, because the notion of a tax-free life is the stuff of fairytales, really.

Unless you're in the racing industry, of course - then it's the expectation.

Putting this industry on the same footing as the rest of us would likely assist alleviating its plethora of animal welfare problems, which are mostly driven by gambling-addled dreams of one day having a winner.

The whole thing is so unreasonable it's almost unbelievable, and it has been sitting silently right under our noses for more than 50 years. Isn’t it time to modernise legislation around racing perks, and to drag this industry into the 21st century?

Or do you think the racing industry and its beneficiaries deserve a free pass on paying tax?

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