Racehorses

1. What recent discussions he has had with the Chancellor of the Exchequer on the effect of the Government’s tax policies on the movement of racehorses between the UK, Ireland and France; and if he will make a statement. [R]

I thank my hon. Friend for his question and pay tribute to his tireless work campaigning on behalf of the horse-racing industry. The Government recognise the contribution that racing makes to our sporting culture and to the rural economy. We equally understand the critical importance of being able to move racehorses across international borders. We are aware that the industry has provided proposals to HMRC and the Treasury regarding the VAT arrangements, and I can tell the House that the Treasury is actively considering those proposals at the moment.

I thank the Minister for that encouraging answer. As he knows, the owners of racehorses coming to this country to race have to deposit a VAT-equivalent security, returnable when they leave, whereas the owners of horses coming to this country for what are classified as work purposes do not. Given that it would not cost the Exchequer anything to correct this anomaly, and that it would help cash flow and reduce the administrative burden on racehorse owners, I hope that the Minister will continue to speak to the Treasury with a view to correcting it.

I thank my hon. Friend for his clear articulation of the issue and his powerful expression of it. I will certainly convey that to Treasury colleagues who are currently considering the matter.

Can I just say, Madam Deputy Speaker, that I really enjoyed the different tradition we had this morning when we entered the Chamber? It is the first time I have seen it, and I would like to say how well the House does it.

Racehorses are very important to my constituency; they are an integral part of some of my constituents’ lives. The Northern Ireland protocol has obviously complicated things, so can the Minister tell me how my constituents in the racehorse industry in Strangford and in Northern Ireland can get through the minefield of bureaucracy and red tape?

The Government are extremely mindful of the challenges that the way the Northern Ireland protocol is being applied is imposing on communities across Northern Ireland. It clearly affects the horse-racing industry as it affects others. I know that my colleagues across Government are working extremely hard as we speak to find practical ways of fixing those problems, and I am sure that my colleague the Foreign Secretary will keep the hon. Member and the House updated on her efforts.

The anomaly on VAT, which ridiculously argues that a racehorse coming here to race or a brood mare coming here to breed is not coming for work, needs to be sorted.

Can the Minister also please ensure that the horserace betting levy is increased and reformed far sooner than is currently proposed? Although horse-racing is doing great at the moment, there is a significant challenge with the low level of prize money, which is leading to fewer runners and too many horses running overseas rather than here. We need to make sure we support the industry.

I thank the former Secretary of State, who is a representative of a horse-racing constituency, for his question. Clearly quite a lot of money is going into the horse-racing industry via the levy. It is on track to raise about £100 million this year, most of which ends up in prize money. However, my right hon. Friend has made a number of powerful representations, both in this House and privately, about the need to review that levy earlier than was planned, and his powerful representations are being actively considered as we speak.