Hong Kong Jockey Club declares record turnover of HK$304.8 billion, as it looks ahead to ‘challenging’ post-Covid period

The Hong Kong Jockey Club has declared an all-time high turnover of HK$304.8 billion (US$38.9 billion) for the 2022-23 financial year, a rise of 5.1 per cent year on year despite the effects of the Covid-19 pandemic.

The city’s sole authorised gambling operator on Tuesday also announced a record HK$35.9 billion had gone back into the community over the same period, representing a 6.8 per cent increase year on year.

The sum included HK$28.6 billion in betting and lottery duties, profits tax and lotteries fund contributions, as well as HK$7.3 billion in approved charitable donations.

“Through resilience and agility, the club performed extremely well during the pandemic,” club chief executive Winfried Engelbrecht-Bresges said. “However, there is no question that the post-pandemic environment is proving equally challenging, with the economy likely to be highly volatile for some time to come.”

The club’s turnover from horse racing stood at HK$140.4 billion, almost matching the amount earned in the 2021-22 financial year. The organisation said it had held 87 race days in 2022-23, compared with 88 the year before.

Revenue from the Mark Six lottery rose 29.2 per cent to HK$7.5 billion, which the club attributed to the return of three draws per week.

On the football front, the turnover from betting increased by 9.1 per cent to HK$156.9 billion after Fifa World Cup Qatar 2022 went against the norm by running from November to December and falling within the middle of the financial year.

“While turnover was up, the club’s income was flat at HK$9.8 billion due to increased taxation in the form of special football betting duty of HK$12 billion, which is payable over five years, with [HK$600 million] being paid in the 2022-23 financial year,” the club said.

Financial Secretary Paul Chan Mo-po announced the betting duty in his budget speech in February as part of government efforts to boost short-term revenue and cope with the city’s huge deficit.

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The minister at the time said he had taken the club’s financial situation into consideration and was confident the special duty would not hinder its charity work.

The organisation on Tuesday acknowledged the government’s rationale behind the policy, but expressed concerns the move could extend beyond its five-year window.

“The club remains very concerned about any permanent increase in taxation, especially in the rate of betting duty, which is already far higher than in other jurisdictions.”

The gambling operator pays 50 per cent of its gross margins on football under the duty, while Macau hands out just 25 per cent.

Hong Kong Jockey Club warns of unlicensed competition emerging under betting duty

The duty rates in Hong Kong for betting on horse races stand at 72.5 per cent to 75 per cent on a progressive basis, but is only 40 per cent for operators in Japan.

The club was founded in 1884 and is the sole licence holder in Hong Kong for the operation and management of horse race and football betting, as well as the Mark Six lottery.

It also operates as a not-for-profit organisation and allocates its surplus revenue to charitable and community projects.