P40-B horse racing industry is dying

In Metro Manila, horse racing is a form of gambling/recreation dating back to the days when the original racetracks were in San Lazaro and Santa Ana. It provides revenues for the government and is also a source of funding for charitable institutions.

Last year’s P7.37 billion bets gave a net tax of P1.25 billion. The money came from the thousands of people who read “Dividendazos” at off-track betting stations (OTBs) and horse owners betting on 2,900 racehorses.

Today, if the industry could be compared to a picture, it would be gloomy, if not on the verge of disappearing.

Metro Turf Batangas, Manila Jockey Club and Philippine Racing Club in Cavite have registered declining horse racing bets: Down by 15.05 percent in February, 25.40 percent in March, 17.92 percent in April, and minus 22.71 percent in May, says the Philippine Racing Commission (Philracom).

Three reasons were cited. First, the unhampered proliferation of “illegal horse racing bookies.” Second, the TRAIN law’s 20-percent documentary tax hike and third, the full operation of “e-sabong” at horse racing OTBs.

To bettors, fewer bets mean smaller winning dividends from higher bet deductions. For horse owners, smaller winning prizes equals bigger expenses for horses and staff. To the whole racing industry, it means certain death.

For the first time, the age-old “daily double” and “forecast” bets were removed after the industry agreed that “illegal horse racing bookies” were taking all the money while the government got nothing.

The Games and Amusement Board (GAB) tasked to go after illegal gambling conducted only five anti-illegal bookie operations last year, arresting 22 people, including seven bet collectors, a runner, a manager, a supervisor, one employee and 11 bettors.

The TRAIN law minimized racehorse winning dividends, making it unattractive to bettors. The 38-percent deduction is just too much. Again, nothing goes to government and an amendment is most necessary here.

E-cockfight gambling pulls down horse racing revenues at the industry’s very own OTBs. Quezon City lost amusement/franchise taxes from illegal “e-sabong.” Valenzuela also closed down OTBs with e-sabong operations.

In March 2017, the Anti-Trapo Movement (ATM) charged Philracom chair Andrew Sanchez and several others with graft in the Ombudsman for allowing “online sabong” to operate at horse racing OTBs, therefore not protecting the industry. Founder Leon Estrella Peralta says the government has lost P350 million in revenues since December 2015.

For its part, Manila Cockers Club Inc. (MCCI) says its operations are valid and legal, adding that it dutifully remits taxes to the BIR, on top of local business taxes and “sultada fees” to Carmona, Cavite. This was upheld in April 2017 by GAB chair Baham Mitra who said the “MCCI can utilize any available online, digital and wireless electronic platform,” giving e-sabong a nationwide, even worldwide web effect, without a congressional franchise like horse racing.

But on Aug. 1, 2017, Solicitor General Jose Calida ruled that GAB had no authority, and betting activities outside of cockpits was a crime. Calida also ruled that MCCI’s “e-sabong” was illegal. On Feb. 5 this year, GAB instructed the three racetracks to cease from taking bets on MCCI cockfights through GAB-authorized OTB terminals.

On the whole, the horse racing industry is in the doldrums and Philracom and GAB must take drastic action. If these problems continue, what will happen to the sport of kings; horse breeding; revenues, jobs and livelihood from the industry and investments of P40 billion?

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