§ In subsection (3) of section one of the Finance Act, 1935 (which provides for reduced rates of entertainments duty in the case of certain entertainments) for the words "other than the racing or trial of speed of animals," there shall, with effect from the fifth day of August, nineteen hundred and fifty-one, be 193 substituted the words "including the racing or trial of speed of horses but not of other animals."
§ Brought up, and read the First time.
§ Captain Stanley (North Fylde)
I beg to move, "That the Clause be read a Second time."
I ought to declare an interest. I come from a family not unconnected with racing and I myself have two horses. One, I am delighted to say, has been successful, and with the other I am hoping for better things. This Clause, rather like that on speedway racing, is non-party, for there are people on both sides of the Committee who like racing very much and people on both sides who dislike it. We have had the Financial Secretary telling us that betting does not come into it, and therefore I hope that everyone will be able to look at it in the proper light.
In connection with speedway racing we have already had a discussion about live entertainment, and I do not propose to go into that aspect of the matter, except to say that, if any hon. Member is in doubt, in this year's Grand National there were 36 starters and 11 jockeys fell at the first fence. I have never had that experience, but it must be a most unsatisfactory one. The Financial Secretary has been well briefed, and he has discovered that the skill of jockeys does matter in handicaps. I congratulate him on that. If he comes a bit further, he will find that jockeys are very important in all races.
In racing there are many people who back their favourite jockey; many will have a mixed double with Gordon Richards, or a jockey like him, so skill comes very largely into it. My right hon. Friend the Member for Aldershot (Mr. Lyttelton) made a lot of fun about elephants on racecourses. He will be causing a great deal of anxiety to the Leader of the House if he should persuade the Jockey Club to let elephants race round Tattenham Corner just before the Derby.
One of the most important points is that there is a racecourse in nearly every part of England and Scotland. Many of them are places where people can go for their picnics. and early closing day coincides with racing so that all can go. 194 There are 71 courses, where all this happens, and everyone who goes and is successful has a good time. All over the country you have only to see a man selling newspapers and shouting the results and you will notice that many more people will buy a paper for that than if be were shouting news of something that has happened in this House.
Besides being a sport, racing is a great industry. No one who has been to a town like Epsom, Newmarket, or Middle-ham, and there are many others, can fail to realise what a great industry it is. A great many people are employed, and I think that they are among the most happily employed in any industry. This industry also makes a very great contributions to exports. The export of blood-stock over the last year amounted to £5 million.
There is associated with racing the idea that rich people own racecourses, and that all racecourses make a fantastic profit. The net profits of the 71 racecourses totalled £91,000 last year, and the extra tax which the Chancellor is putting on will mean roughly £100,000. I cannot believe that there is any other industry in this country which will have such a tax put on it that it cannot make a profit at all. The figures I have given are diminishing, so that the industry will show an even greater loss. Racecourses are not only owned by private shareholders; six are owned by local authorities. The biggest and most famous is probably that owned by the local authority which the Minister of Agriculture can tell us most about.
I should like to point out what it will mean if this extra burden outlined in the Finance Bill is put on. There are three different places for people to go to: on the course, where the charge is 4s. 6d. and they will have to pay an extra 3½d.; in the public enclosure, where the charge is 10s., and they will pay an extra 5d.; and in Tattersalls, where they pay 30s., and will have to pay an extra 1s. 8d.
Compare the terrific taxation put on race-courses with what is paid in football. Not that I can say anything against football as Blackpool is next to my constituency. Last year 34 million people attended League football matches, and they paid £700,000 in tax—an average of 5d. each. The 5,500,000 who went racing paid 195 £1,626,000—an average of 5s. 10d. each in tax. It seems to me unfair that there should be such a difference. We have been told by the Financial Secretary that one of the first things that is looked into is how attendance has been affected. Over the last three years, attendances at racecourses have gone down from 10,200 in 1948 to 9,360 in 1949 and to 8,580 in 1950—a great drop, which, with extra taxation, will surely be greater still.
If the extra tax is not put on the public, it will have to be taken off the stake money of the owners. There are those hon. Members who will say that a man who wins £19,000 at the Derby could well have a bit cut off; but it is not the racecourse that pays the £19,000. The racecourse puts up only £4,000; the other owners put up the other £15,000. The owner who wins the Derby is probably a big owner with a string of horses: it is the small man with one or two horses who is the type of owner we want to encourage—the man Who goes in for races worth £300 or £400, who thinks it wonderful to win a race of £300. When he does there is 25 per cent. taken off that stake money. It costs between £600 and £700 a year to keep a horse, so that an owner with one horse has to be fairly successful to come out plus at the end. Anyone who knows anything about racing will agree it is important to have as many people owning horses as possible.
The Chancellor is on the look out for more money. Let me give him a hint about how he can make it out of racing. I do not know how the right hon. Gentleman the Leader of the House will take this suggestion, but he ought to do something about the Report of the Betting and Gambling Commission. If we could run racing as it is run in Ireland, the Chancellor would get more money, and so would racing. This is a point well worth looking into by the Chancellor and the Leader of the House. In Ireland, racing has been greatly improved, stake money has been increased and facilities for the comfort of the people who go racing have been improved. Nobody minds paying a 2½ per cent. tax on a winning bet if it is to improve racing.
I should also like to point out to the Chancellor the terrific interest there is in racing. That was brought out by the 196 Royal Commission when they showed that over 50 per cent. of the adult population have a bet on the Derby.
§ The Chairman
I regret interrupting the hon. and gallant Gentleman, but he is far from the Clause, which deals with Entertainments Duty.
§ Captain Stanley
I am sorry if I went too far, Major Milner, but I got run away with.
I hope that when the whole question of the Entertainments Duty is gone into by the Chancellor he and his advisers will seek the advice of the Jockey Club, the National Hunt Club and others who are in a position to give advice and so help racing to prosper to the advantage of all those people who are engaged in it and those who get so much enjoyment from it.
§ Mr. Jay
I should like to express my gratitude to the hon. and gallant Gentleman the Member for North Fylde (Captain Stanley) for the expert confirmation he has given of the diffident view I expressed last week that horse racing is partly dependent on the skill of the jockey. This new Clause would put the Entertainments Duty on horse racing at a lower rate than that on other forms of racing, including speedway racing, just as the Amendment we discussed last week would have put the tax on speedway racing at a lower rate than on other forms of racing. In our view, there is no case made out at present for discriminating in either of the respects.
Some of the hon. and gallant Gentleman's arguments would confirm what I attempted to suggest last week, that if we were to take action on the lines suggested for speedway racing, other forms of entertainment could raise objections and put their own case forcibly. Indeed, when the hon. and gallant Gentleman spoke of attendances, he could have argued that, whereas speedway attendances were still a good deal larger than they were four or five years ago, attendances at horse racing are, if anything today, rather smaller.
For all these reasons we cannot ask the Committee to accept this Clause, but I am very glad to add to the assurance that I gave last week that we will review the whole structure of this tax in the future. In doing so, we will certainly take into 197 account the arguments advanced by the hon. and gallant Gentleman.
§ Mr. McCorquodale (Epsom)
I do not wish in any way to bring this debate to an end, but I should like to make a few remarks on the racing situation, as I have the honour to represent Epsom in this House, a place to which we extend a very cordial welcome to many Members and to thousands of others, too, on Derby day. I am sure that my hon. and gallant Friend the Member for North Fylde (Captain Stanley) will agree with me when I say I am grateful to the Financial Secretary to the Treasury for the sympathetic tone, if not words, which he used just now. We hope that when the time comes to consider this tax he will give most sympathetic consideration to horse racing for one or two reasons, which I propose now to put before the Committee.
Horse racing is the largest industry in Epsom, as my right hon. Friend the Leader of the House knows, and any injury to this great and very English sport would affect most grievously the area which I represent. I remember during the war that considerable discussion took place as to whether horse racing should continue during those anxious days. There was strong pressure by many people, especially from the hard-pressed transport side, that horse racing should be abandoned.
I do not think I am betraying any secret when I say that my Minister, the late Mr. Ernest Bevin, took a most firm and decided view on it. He insisted that the war workers needed something to think about outside their work and outside the war news, and he argued that horse racing helped to maintain high production throughout all those monotonous days during which men worked at the bench. Indeed, one can claim that horse racing was a great boost to industrial morale in those dark days, and I am glad to think that I was able to collaborate with my colleagues, from both sides of the House, in winning general agreement, in the national interest, that horse racing should continue in spite of all the difficulties.
§ Mr. McCorquodale
I am trying to show, Major Milner, that if this Clause is not carried, then this great industry, which we were able to keep even during the very difficult days of the war, will suffer hard times. It was most desirable during the war that we kept it going; how much more desirable must it be now.
There are many aspects to be considered; there is the export trade in bloodstock, the great tourist industry, and even the nationalised railways would all suffer very grievously if anything happened to horse racing. Indeed, there are no fewer than eighteen million people who are interested in Derby day, so far as the result is concerned, and they, also, would suffer.
Therefore, I do suggest that if horse racing suffered damage which might even bring it to a stop, the morale of a great section of the community would be grievously affected. Figures already show that attendances at horse racing meetings arc decreasing, and the profits are disappearing almost to vanishing point; and if nothing is done, then the goose which has been laying the golden egg of 5s. 10d. for every meeting, will weaken.
Horse racing is classed as a "dead" sport, despite the jockeys and the thoroughbreds, and I must say that I find this difficult to understand when remembering that a circus, with horses galloping round a ring with no jockeys, is classed as a "live" entertainment. It may be that the betting on horse racing causes it to be considered separately from the circus. But the betting at present is very similar to that on football matches. Football, as a game, does not benefit as a result of the betting on pools, nor does horse racing benefit because of the betting which takes place every time there is a meeting.
Therefore, in common fairness, I ask the Chancellor, in the public interest, as well as from the revenue collecting viewpoint, to treat this grand and very live British sport for what it is—a living entertainment for the people of this country, and to reduce the rate as asked for by my hon. Friend as soon as it possibly can be reduced.
§ Mr. W. T. Aitken (Bury St. Edmunds)
Like my hon. and gallant Friend the 199 Member for North Fylde (Captain Stanley) I have no personal interest, but a constituency interest, in this debate. There is no place in the world where more people make their living, either directly or indirectly, out of horse racing, than the town of Newmarket. Many hon. Members have shown a deep and affectionate regard for this ancient sport, but how many realise the vast and varied activities which lie behind the 71 race meetings which take place in this country every year? Not only are there jockeys, owners, and breeders, but there are saddle and harness makers, veterinary surgeons, and so on, all concerned with, and in most of those cases, living on the prosperity of the racecourse.
I am sure that if the Minister of Agriculture were here he would certainly agree that horse racing is the very foundation of the whole bloodstock industry of this country, not only affecting horses but everything. Not only the knowledge, but the skill and years of experience which have gone into breeding horses, affect all kinds of other aspects of our bloodstock industry. I do not propose to detain the Committee very long because this argument is simple and unassailable.
Racing is important not only because it gives a good deal of entertainment, if not always profit, to millions of people in this country, but it gives a livelihood to thousands of others. What is more, it is a very important export industry. The figure quoted is £5 million a year. If one goes to the December sales at Newmarket, one will find the first question every foreign buyer asks of the horse is, "How much did it win?"
The stakes which are paid out for racing are paid out by the racing executives and this depends very much on the income from the course. This new tax especially will wipe out all the profit of racing. The concession we are asking, which is to compel the tax collector to consider racing a live sport as every other reasonable person in the country does already, will cost the Chancellor about £1 million. If one wants to see some racehorses going really cheap, if one wants to see some very big reduction in that £5 million of exports, the Chancellor has only to continue with his entirely illogical category of a non-live sport.
200 This £5 million export of bloodstock is something which will be very seriously damaged if racing is not considered a live sport. That is the most important argument we can put forward at the present time. I should like to hear very much more about that because I am certain the losses on exports alone from the position which racing is in, as an organised sport. will be greater than the problematical revenue which the Chancellor is likely to obtain out of racing next year. The loss made will be greater than the gain to the Exchequer over this hoped-for revenue from the new tax and the position racing is in as a non-live sport.
§ Committee report Progress; to sit again Tomorrow.