Pari-Mutuel Tax

Disclaimer: This is intended to provide information respecting Harness Racing Tracks in the Province of New Brunswick under the Pari-Mutuel Tax Act (the Act). This should not be regarded as a replacement of the laws, regulations or administrative documents to which it refers.

Pari-mutuel betting was developed in France at, or about 1870. The concept relates to prize pools being divided and paid to those placing bets in accordance to placement of the competitors. Traditionally prizes are paid on the basis of those who finish in first, second and third place only.

"Pari-Mutuel" is defined as a system of betting on races in which the winning bettors share the total amount bet minus a percentage to the operators.

In New Brunswick, pari-mutuel bets are subject to tax. This tax is imposed under the Pari-Mutuel Tax Act which is administered by the Revenue & Taxation Division of the Department of Finance. The tax is applied to the gross wager at a Harness Racing Track (called the Pari-Mutuel Bet).

The current tax rate is 11% of each pari-mutuel bet (e.g. the tax on a $2.00 bet is .22 cents).

The Pari-Mutuel Tax Act places the responsibility to pay the tax on the consumer. The tax is collected by registered race tracks (collectors) and remitted to the province. The collector receives a commission of 10% of the amount bet.

Any person who wishes to operate, conduct or manage a pari-mutuel system of betting or receives bets through the agency of a pari-mutuel system must obtain a valid registration certificate issued under the Pari-Mutuel Tax Act.

The Minister of Finance may issue a registration certificate to a person with respect to a pari-mutuel system operated, conducted or managed by that person in the manner prescribed by the regulations and upon payment of the fee prescribed by the regulations. The certificate is not transferable and shall be kept at the location of the pari-mutuel system. Applications for a Pari-Mutuel Registration Certificate may be obtained by accessing the following link ( CSS-FOL-PMT-01E.pdf ) or by contacting the Revenue and Taxation Division of the Department of Finance at:

Department of Finance
Revenue and Taxation Division
P.O. Box 3000
Fredericton, New Brunswick
E3B 5G5

Telephone: (800) 669-7070
Fax: (506) 457-7335

The fee for a registration certificate is $1,500. The yearly renewal fee for a registration certificate is $500.

All registration certificates expire on May 31 of each year and must be renewed annually.

The Revenue and Taxation Division must be notified of any changes in regards to the address, contact persons or officers of the registration certificate holder. The certificate cannot be transferred from one person to another.

On or before the twenty-fifth day of each month, every collector under the Pari-Mutuel Tax Act shall

1. make a return to the New Brunswick Tax Commissioner, on a form provided by the Commissioner, of the total amount of all bets that were placed in the preceding month with the collector and that were taxable under that Act, including a calculation of all of the tax due in connection with the bets; and
2. remit to the Minister of Finance all tax due in connection with those bets.

Every collector under the Pari-Mutuel Tax Act shall keep and maintain records on the form provided by the Commissioner setting forth the following information:

1. the number of bets placed in connection with each race and the amount thereof;
2. the amount of tax collected with respect to bets placed in connection with each race;
3. the amount of the collector’s commission for each race;
4. the number of persons attending each race; and
5. any other information which may be requested by the Minister or the Commissioner relating to the management, conduct or operation of the pari-mutuel system.

All books of account, records, documents and other papers pertaining to the operation of a pari-mutuel system must be kept and maintained by the collector upon the premises where the pari-mutuel system is operated, or at such other place as may be authorized by the New Brunswick Tax Commissioner.

Through an agreement under the Council of Maritime Premiers, New Brunswick shares in the funding of the Maritimes Provinces Harness Racing Commission (MPHRC). The commission acts as the governing body for the harness racing industry in the Maritimes. Each year the Maritime Provinces share the necessary funding requirements for MPHRC, to maintain consistency in the application of the rules and regulations governing the sport.

All inquiries should be directed to:

Department of Finance
Revenue and Taxation Division
P.O. Box 3000
Fredericton, New Brunswick
E3B 5G5

Telephone: (800) 669-7070
Fax: (506) 457-7335
E-mail: [email protected]
Web Site: www.gnb.ca/finance

Legislation:

New Brunswick Acts and Regulations may be accessed on the Department of Justice web site (http://www.gnb.ca/justice) or copies can be purchased from the Queen's Printer.