Hong Kong to tax HKJC an extra $12bn over next five years

The Hong Kong Jockey Club (HKJC), the special administrative region’s only licensed sports wagering and lottery operator, has been asked pay HK$12 billion in soccer betting taxes over five years to increase government income. The directive comes after the Hong Kong government revealed a budget deficit for the next fiscal year. 

During the legislative council meeting, the Financial Secretary, Paul Chan, noted that due to economic hardships like the undeperforming stock market and land sales, the government has lost revenue and now has to find new income streams.

“In the face of fiscal pressure, we must seek ways to increase government revenue in the short term,” he said.

Chan then proposed to tax the HKJC $2.4 billion per year in the form of a “special football betting duty” in addition to its current fiscal obligations, starting from 2023 to 2028. He added the club has “undertaken that the proposal would not reduce its commitment to local charities”.

The HKJC noted that while it understands the government’s perspective, the additional tax will lead to a reduced income, which then might end up damaging the club’s business if extended beyond the next five years. However, despite this, the HKJC “will not reduce its regular charity donations to the community, which amounted to HK$4.5 billion in 2021/22”. 

Speaking further, the organization remarked: “Any permanent hike in betting duty rates will create structural problems irreversibly damaging the Club’s successful integrated business model and continued competitiveness, while benefiting only illegal and offshore betting operators.”

The HKJC then called on the government to reduce the standard betting tax rates, which are among the highest in the world. 

While giving a press conference, Chan responded to the club’s financial concerns by saying: “I think it can afford that.”

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