The Turf Authorities of India has welcomed the GST Council’s decision to allow the GoM to reexamine issues related to levying GST on horse racing.

“We are happy to note that the GST Council has deferred its decision on imposing GST on the value of bets placed at 28 per cent. We look forward to the GoM considering how horse racing is different from other gaming,” said Zavaray S Poonawalla, Chairman, GST reform cell of the Turf Authorities of India.

Unlike other games

“This gives us a window of 15 days to present to the GoM that unlike gaming for commercial gain, which is undertaken by other service providers, all race clubs in India are set up as not-for-profit clubs. The licensed horse race clubs have been in existence for over 200 years in India and in the span of their operations, the tax imposed on betting has been on the commission made by the race courses and not on the value of bets. The proposed GST would be against this centuries old norm, international norms and even the State’s betting and entertainment tax, which the GST regime subsumed,” he said.

“All over the world, payouts/prize money on horse racing is not taxed. This should definitely be applicable to the horse racing industry in India too,” Poonawalla said.

The clubs which are all non-profit, support the jockeys, the horses, equestrian breeding and training, besides providing employment to thousands across India. Unlike commercial gaming, all revenue made by the clubs is completely ploughed back into these welfare measures. The GoM needs to be cognisant of the fact that horse racing and equestrian breeding will suffer irreversible damage, if the proposed GST on value of bets is imposed.

‘Cascading effect’

Besides the loss of revenue to the Centre, it would have a cascading effect on India’s environment, considering that the turf clubs provide much needed green spaces in the crowded cities. It will also kill an essential part of animal husbandry and the joy equestrian sport brings to amateur riders and the laurels it brings to the country.

The sport generates lakhs of jobs in the agriculture sector, pharmaceutical industry, and labour industry etc. No value can be attributed to the above in terms of money and the GoM needs to consider the same while taking its decision, which should not be made with only a monetary outlook, Poonawalla said in a release.