2012-01-18
As long as the Swedish state continues to charge the whole Swedish horse racing industry lots of money, more and more Swedish horse owners, breeders and trainers will gather in France.
Owning a trotter is expensive, and if you are lucky, you may benefit financially here in Sweden.
Most horse owners live with deficits, the profits in Sweden is just over 800 million SEK per year, and horse owners spend almost 3 billion SEK annually. You do not have to be a Nobel Prize winner in Mathematics to understand the odds!
Despite this, horse owners have accepted to lose money on their horse investments but this is rapidly changing, and the loser is the Swedish countryside where every job is important. This will of course eventually affect the state.
There are both losers and winners, and in this case the French countryside is the winner. There, the horse racing industry is strong and grows even stronger now since Swedish capital is invested at an increasingly fast pace.
More and more Swedish trainers set up business in France along with Swedish horse owners and breeders. The French government subsidizes its horse racing, and this has been brought up in the EU court where they finalized that the country can continue its support since it creates a lot of jobs in rural areas. In other words, there is not really a difference compared to Sweden despite the substantial differences in conditions for those involved.
People bet lots of money on horse racing in Sweden, in 2011 there was a record. ATG had a turnover of 13 billion SEK, suggesting an enormous Swedish trotting interest although the sport's big successful coaches for many years have warned about the slow developments.
Unfortunately, ATG has to face profit requirements as well as Europe's highest gaming tax, 11 percent of the turnovers, which is as much as 35 percent after the players received their winnings. Overall, this implies that the horse racing is twice as highly taxed compared to our competitor countries. Then there are also other Swedish taxes such as VAT, ATP, energy taxes and others, and where each tax is among the highest in the world.
What are the consequences for Sweden then?
Breeders end their activities, some give away their fillies and some even kill them. Many breeders are buying only French-born horses and more horse owners are moving their Swedish horses or buy them at a French auction.
If your Swedish-born horse has earned more than 700,000 SEK in Sweden, then it's time to move. There are so many races at any time in France and you can easily replace Swedish prize money with Euro. Despite significantly higher winnings, the ownership costs are basically the same in France and in Sweden, which clearly shows that the cost of ownership in Sweden is tax-driven, and not profit driven.
What else happens? - Well, ATG launches their bets on the French racetrack, which is not a coincidence. ATG makes an adjustment to future development in which the Swedish horse race will end up in the B league.
ATG has now started with V4 in French horse racing tracks but V5, V65, V75 and V86 are likely to be adapted for the launch of French trotting. ATG has realized that they cannot change the Swedish state no matter what.
The jobs will be lost to France if all this continues.