Texas Horse Racing To Get Purse Boost From New Law Diverting Sales Tax On Horse Products

As much as $17.5 million per year could be used to support Thoroughbred and Quarter Horse purses in Texas as a result of legislation signed into law last weekend by Gov. Greg Abbott.

House Bill 2463 diverts sales taxes on horse feed, tack and other horse-related products and services from the state’s general fund to an escrow account established by the Texas Racing Commission and capped at $25 million annually. No more than 70% of the funds in the escrow account may go toward purses. If the escrow account reaches $25 million, that would be an additional $17.5 million in purse money annually, virtually doubling the current amount, based on an economic study conducted by TXP Inc. consultants.

A second piece of racing legislation, House Bill 1995, was also signed into law by Abbott. This bill diverts the 1% simulcast tax from the general fund to the Texas Racing Commission, which has been financially strained in recent years. The approiximate $2.8 million windfall will allow the commission to restructure racetrack license fees.

Challenges remain in Texas racing and breeding despite the two pieces of favorable legislation. Tracks in bordering states of Louisiana, Arkansas, Oklahoma and New Mexico have purses and/or breed incentives fueled by casinos or slot machines. Texas, the largest state in the continental U.S., does not permit off-track betting or advance-deposit wagering. Over the last 15 years, according to the TXP Inc. study, wagering in Texas has fallen from $900 million annually to $340.2 million and purses have dropped from $32.5 million to $16.8 million.

Racing is conducted at Lone Star Park in the Dallas-Ft. Worth area, Retama Park in San Antonio, Sam Houston Race Park in Houston and the Gillespie County Fair in Fredericksburg.

The post Texas Horse Racing To Get Purse Boost From New Law Diverting Sales Tax On Horse Products appeared first on Horse Racing News | Paulick Report.

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