Friday, June 2, 2023

The state supports racetracks with up to 40 million euros per year – here’s why


Trotting tracks are, perhaps unsurprisingly, among the biggest recipients of business subsidies in Finland. The explanation can be found in the reform of the Lotteries Act some years back.

Among the largest recipients of business support in Finland is the Varmo Racetrack, which received over 18 million Euros in support in 2020-2022. Thanks to this, Vermon Ravirata Oy was the eighth company in Finland that received the most business support in the statistics of the Ministry of Labor and Economy.

Read more: Here are the biggest recipients of business subsidies – a researcher ponders the strangest cases

Tampere Race Track is also among the top 25 recipients with a pot of nine million euros. Overall, the top 25 group of small and medium-sized companies has nine racetracks and operators in the horse breeding industry as recipients of support.

In fact, racetracks receive a total of up to 40 million euros per year in support from the state. State support for the racetrack goes back to the Fintoto company, which organized the Toto Games, according to Ministry of Agriculture and Forestry official Tapio Juntilla.

– Hevosala previously had its own betting company, Fintoto Oy, Juntila says.

– In early 2017, the gambling operations of Veikkaus, RAY and Fintoto were combined, and the distribution of their profits was drawn up in the Lotteries Act. The horse industry and agriculture and forestry have a share of four per cent.

Prior to this, the racetrack’s financing was arranged mainly from Fintoto’s gaming revenue, but since 2017 this money has been channeled through Vekkos and the Ministry of Agriculture and Forestry. MMM reports state subsidies to the Labor and Economy system, where they are registered as business subsidies.

State subsidies for the racetrack have also been approved by the European Union Commission.

State subsidies for trotting tracks are divided into three main categories. In Vermo, for example, 2/3 of the prizes for trotting winners are paid with prize support, and the trotting track also pays prizes from its own funds.

In addition, the paid operational support is intended for the cost of maintaining the racetrack. The third and shortest form of support is investment support.

In recent years, racetracks have also suffered due to reduced profits due to the corona pandemic and restrictions.

According to Suomen Hippos Ray, funding the horse industry is not ineffective support.

– The Finnish horse industry employs almost as much as tourism in Lapland at 6,500 person-years, and generates a regional economic impact of more than 270 million euros per year through horse breeding alone, Hippos reports via email .

Furthermore, the horse industry is projected to reduce, for example, social and health sector costs.

– The lifetime cost savings for the position of young people removed from marginal risk, calculated in a recent effectiveness analysis of the horse industry, is estimated at 1.6 billion euros, the message mentions.

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