The Mahalaxmi racecourse lease expires by the end of this month. While the city is on edge about the fate of this land, it is time racing bigwigs and the Govt. work together to rejuvenate this industry
First, it was a minister who wanted to “sell” the Mahalaxmi racecourse to ease the state’s debt burden which was, ironically, created by the thoughtless policies (not to mention the ubiquitously corrupt practices) pursued by his tribe. Then, there was a lady mayor who imagined Mumbaikars’ traffic woes would lessen considerably if only the racecourse would get converted into a giant, multi-layered parking slot. And now we have another city mayor who wants it to be converted into a garden for the common man’s use, blissfully unaware of the fact that the racecourse, with all its open spaces, playgrounds, jogging tracks, is accessible to any Mumbaikar round the year.
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Acres
Fortunately, every time someone drooled over the prime and pricey racecourse real estate which measures approximately 226 acres, the average Mumbaikar, propped by alert media, has always seen through their so-called altruistic motive and thwarted the attempt, as they are yet again doing this time. According to government sources, there are indications that Prithviraj Chavan, the Chief Minister known for his no-nonsense attitude, is unimpressed by the debate started by politicos. Sources say the Chief Minister has already done an objective assessment of the issue, and his visit to the Mahalaxmi racecourse to personally give away the Chief Minister’s Trophy on the last day of the just-concluded Mumbai racing season (April 28) is viewed as an endorsement of his favourable opinion about the race club and its pro-public activities.
Soul Searching
The Royal Western India Turf Club (RWITC) management, right now, may pin their hopes on the Chief Minister’s sense of fairness to get them justice and to get the land lease renewed, but it is high time they also do some soul-searching as to why only they are repeatedly singled out for attack.
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Revenue
While the value of the prime land could be one major reason for these repeated attacks, the fact that despite tremendous potential Mumbai racing has consistently failed to generate decent revenue for the state’s coffers cannot be ignored. The club, or its sympathisers, cannot paint all politicos with the same brush and try to dismiss them as devil’s agents, surely not without undertaking a hard and truthful introspection as to why it (with about 1,000 horses and 70 race days in a year) contributes a paltry sum of merely some crore of rupees when Hong Kong racing (with 700 horses and about 80 days of racing in a year) generates nearly HK$ 10 billion for the state, donates another HK$ 1.73 billion to charities, before pocketing nearly HK$ 400 million profit for itself.
System
Hong Kong racing owes its super success to having an efficient and transparent monopoly betting system (Tote), offering excellent racing product (competitive racing, well-filled race cards and imaginative betting pools) and a high level of supervision to preserve integrity of racing. Like Hong Kong, racing in Maharashtra has great potential to generate massive revenue for the state, if only both the race club and the State government sit together and try to replicate the Hong Kong model in its totality. But for that to happen, the government must first abolish the ridiculously high betting tax, which is driving more than 90 per cent of the betting volume into illegal channels. On its part, the club too must scrap all its wrong policies, like allowing use of mobile phones, at a hefty price though. Which may be bringing in short term profit for them but which, in the long run, is certainly going to drain this sport completely dry of its most vital ingredient — the betting money.
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Life
If the CM has really studied the issue in detail, then he must have understood that it is much more important to give the sport of horse racing a new lease of life than to merely give the race club a new lease on the use of land. Then and only then, the sport of horse racing can create a win-win situation for all concerned. The club, like any other company (interestingly, it is incorporated under the Companies Act, 1956), can be used for generating massive turnover from its actual area of expertise (conducting races). The state treasury can then collect its massive dividend every year for the act of turning around a sick company into a goose that would lay golden eggs year after year.
High tax: Root of all evil
The Maharashtra government levies a hefty 20 per cent betting tax on tote and 30 per cent tax on betting with bookmakers, due to which the betting volumes drop so drastically that the RWITC is constrained to charge minimum 6 (on basic pools like Win/Place) and even more on multi-leg pools (like jackpot, etc) to make ends meet. This cascading effect results in as high as 44 per cent deduction in some cases. No wonder, more than 90 per cent of the betting money finds its way to illegal channels which charge zero tax.
The Hong Kong government charges only 10 per cent (after surcharge it gets to 11.7 per cent) betting duty which boosts gambling volumes to such astronomical extent that a mere 4 per cent commission brought in HK$ 3.7 billion in 2012-13, and everyone from the government (HK$ 9.9 billion) to the race club (total turnover from horse racing alone touched a record HK$ 84 billion) to punters (after rebates and incentives, 87 per cent of the pool was returned to the punting community) are happy as it is a win-win situation for all.u00a0
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