Legislation

Argentina – Buenos Aires to end state subsidies for racetracks

By Phil - 17 January 2018

The Minister of Economy for Buenos Aires, Hernán Lacunza, is planning to cut state subsidies that go to the four racetracks in the province by 25 per cent meaning that the tracks will lose out on an estimated $300m per year.

The cut in state subsidies will affect the San Isidro, La Plata, Azul and Tandil racetracks.

As a result, organisations from across the sector met at the headquarters of The Association of Racetrack and Betting Agency Personnel (APHARA) last week. At the meeting, unions agreed to seek common ground in order to present joint proposals to the government authorities. As a first general measure, they asked that the government refrain from taking any measures without consulting representatives of the industry first.

Omar Alegre, General Secretary of the Union for Staff of the Hippodrome of La Plata said: “Undoubtedly, the entire horse industry is very concerned and the result of that concern was the meeting. We are very concerned about this cut that the provincial government plans to carry out on the funds allocated to horse racing, it is a cut of 25 percent, and this will greatly harm the racecourses of San Isidro, La Plata and, fundamentally, the racecourses in the interior.”

In 2005, the government created the Horse Racing Improvement Fund in order to give the sector a boost in the face of the proliferation of slot machines. Five per cent of the amount generated by slots in the capital goes to the fund, while 34 per cent goes to the coffers of the province of Buenos Aires. In turn, according to Provincial Law No. 13.253, the government must allocate through the Provincial Institute of Lotteries and Casinos (IPLyC) between nine per cent and 15 per cent to the four racetracks in the province since they do not generate their own profits. At the racetracks, 60 per cent goes to the prize pool and the rest to operating expenses and infrastructure.

Economy Minister Hernán Lacunza wants to lower this fund from 12 per cent to 9 per cent, which would mean a cut of $300m per year. In addition, according to industry experts, the new cuts could put up to 70, 00 jobs at risk. The news comes as Governor María Eugenia Vidal last week announced that gaming in the province would be restricted in order to curb gambling addiction.