Government, and to a lesser extent lawyers, have become beneficial stakeholders in the horseracing industry in recent times. Both have seen their coffers boosted by the industry’s apparent vulnerable inability to deal with the pounds and politics of everyday life in the corporate jungle.
While Phumelela have been fattening lawyers for donkey’s years, and have probably found some of their gunboat diplomacy blowing up in their faces, the more détente and considered approach by Gold Circle will make for interesting observation after they find themselves facing their own headaches with those in power, with 2020 still in nappies.
Earlier this week, the Gauteng MEC for Economic Development, Agriculture and Environment, Ms Morakane Mosupyoe, produced something of a PR gem when announcing that she finds it unfortunate after months of settlement negotiations, that Phumelela has closed the door for further engagement with her department.
Last year Phumelela said the proposed amendment to Gauteng’s gambling regulations could cost it R75m a year while also damaging the local horseracing industry.
So now the financially traumatised company is heading to court looking bad – which some will say comes naturally – while the Government preaches that it had hoped to achieve important objectives by working together with them.
The truth can be stranger than fiction some days!
These apparent objectives include the increase of black racehorse ownership and meaningful participation in Phumelela – itself a product of Government assistance, the creation and adoption of an industry turnaround strategy, the establishment of an entity to develop and benefit Industry stakeholders – grooms being top of the agenda – and to provide satisfactory accommodation for this vital sector in and around Gauteng.
At a cursory glance, all of the aforemementioned – whether remotely realistically attainable or not – are festering wounds in racing’s recent history
And down in KZN, Gold Circle have not escaped Government’s caringly grubby paws, with the coastal racing operator finding itself facing increased tax rates on totalisator betting turnover – upped from 1,5% to 1,75% – which will painfully scrape around R3 million off their bottom line annually.
The Bookmakers punters tax redistribution to Gold Circle didn’t escape the review either – with the proposal suggesting a reduction from 3% to 1,6%. This is a painful R21 million a year into thin air – or luxury vehicles and overseas trip – or whatever it is that Government does with taxes.
An intended urgent interdict by Gold Circle to reverse the amendment to the KZN Gaming & Betting Tax Act was averted after some serious negotiation saw the MEC agree to withdraw the amendment retrospectively – Gold Circle not unreasonably believing that this effectively restored the status quo.
But after meeting the MEC, together with Gambling Board and Economic Affairs officials at the end of January to discuss matters and sketch the havoc that the changes would wreak on racing , Gold Circle were informed that redistribution of the Bookmakers Tax would in fact be suspended – yes , not exactly what they expected – pending the resolution of ‘legal and legislative issues’ around the proposed amendments.
Gold Circle naturally felt that the 3% cut should continue to be paid in terms of the existing laws, until things are sorted out.
This now sees yet another stalemate that could very likely end up in court. Are lawyers ever unemployed?
Government are no angels. Racing has been resting on its laurels under a divided leadership with no plan to take the sport into the 21st century. And window dressing is one thing. Transformation is entirely another.
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