Swedish racing stakeholders release joint statement blasting GGR tax hike

A number of prominent figures in Swedish horseracing and trotting have expressed their frustrations over the recently imposed GGR tax hike.

A four percentage point increase in GGR tax from 18% to 22% came into effect on 1 July and the country’s government revealed that it hopes to see the decision increase tax revenues by as much as SEK539m (£39.8m) per year from 2025.

However, the same four percentage point increase means that more of Sweden’s horseracing industry is likely to miss out on more than SEK200m in funding from monopoly horseracing operator ATG.

In response, three high-profile racecourse managers have issued a joint statement that appeared in Swedish publications Skillingaryd, Västerbottningen and Mölndals-Posten, making their feelings on the tax rise crystal clear.

The statement, signed by Vaggeryd racetrack manager David Källgren, Åbytravet CEO Jon W Pedersen and Skellefteåtravet chair Håkan Fahlgren, focused on horseracing and trotting’s role in the wider economy.

The open letter described the tax hike as “hard blow” to an “already pressured industry”.

The statement read: “Because equestrian sport is not just a passion, which contributes to increased quality of life and public health through meaningful employment. 

“It is also an important part of the entire Swedish economy, which with its 355,000 horses has a turnover of SEK32bn and generates nearly 20,000 jobs. The horse industry also contributes SEK6.5bn to the state treasury and SEK1.1bn in gambling tax every year.”

The letter later highlighted the importance of ATG funding before issuing a plea for other stakeholders in the industry to follow suit and demand GGR tax decreases.

“The horse industry in Sweden has had a fivefold increase over the past 50 years, thanks to ATG’s and trotting sport’s great contribution,” it continued. 

“On behalf of the state, a development that now risks being completely destroyed with the new ‘horse tax’ which is being introduced without any impact analysis whatsoever by the same state.

“Therefore, we are now calling on everyone in the horse industry to join forces for a reduction in the horse tax. A lowering from a level that is wrong from the start. For example, a more differentiated gambling tax, calculated according to the level of risk, would bring even more to the treasury. 

“It would benefit both Sweden, the entire horse industry and our local horse entrepreneurs around Vaggeryd, Åbytravet and Skellefteåtravet.”

The passionate plea came nearly two months after ATG CEO Hasse Lord Skarplöth suggested that figures in government would be open to amending the four percentage point GGR tax hike.

He hosted a gambling-specific seminar in April that was attended by Niklas Wykman, the financial markets minister and member of the Moderate Party.

Skarplöth was of the belief Wykman had been open to ditching the blanket GGR tax rise on all operators, with the ATG chief previously calling for differentiated rates for sports and horseracing operators compared to online casinos.

He explained: “[Niklas] underlined that the tax increase from a strict regulatory perspective is a disadvantage because it risks driving players to less calculated companies that can attract, with bonuses and foul play, in a way that the gambling laws do not allow.

“He has insight into all this and says he ‘doesn’t close any doors’ to ATG’s proposal for a differentiated tax.”

However, at the time of writing, those hopes for a differentiated tax structure have yet to be realised.

Elsewhere, the Swedish Trade Association for Online Gambling (BOS) has calculated that as many as 1,000 new problem gamblers could be created as a result of the GGR tax hike.

A BOS report suggested that it will spark a wave of customers now switching to the unlicensed market, where 30% of bettors report gambling problems, as opposed to just 2% in the licensed market, as per the Public Health Agency of Sweden.