Betfred Walks Away From All Five British Classics After Machine Duty Rise

Fred Done warned in September that Betfred would drop the Classics if the Budget raised machine games duty, and on 5 November it did. Britain's most prestigious Flat races need new backers just as bookmakers retreat from racing.

• Betfred said on 5 November that it will not go ahead with a three-year renewal of its sponsorship of the 2,000 Guineas, 1,000 Guineas, Derby, Oaks and St Leger
• The bookmaker cited successive tax rises and "in particular" the machine games duty increase in the 28 October Budget, which lifts the rate from 20% to 25% on higher-stake machines from April 2027
• Betfred has backed the Derby, Oaks and St Leger since 2023 and the two Guineas since 2025
• The Jockey Club, which stages the Guineas and the Epsom Classics, and Arena Racing Company, which stages the St Leger, have named no replacement sponsors
• Betfred is also ending its rugby league sponsorship after this season, citing tax

Betfred Says the Cumulative Tax Bill Left It No Choice

"Following successive tax rises for the betting industry, and in particular the increase to machine games duty at the most recent budget, it is with great sadness that we have taken the difficult decision not to proceed with a three-year renewal of our sponsorship of the British classics," a spokesperson said in a statement reported by the Racing Post and City AM. "It is not a decision we wanted to make, but the cumulative cost of government policy has left us with no choice."

The tax named is machine games duty (MGD), which falls hardest on betting shops, not Remote Gaming Duty, which went to 40% in April. In the Budget on 28 October, Chancellor John Healey raised MGD from 20% to 25% on machines with stakes above £1 or prizes above £100 from 1 April 2027. Betfred's modelling of the new MGD rate shows 284 of its 1,094 remaining shops becoming loss-making, with 1,420 jobs at risk, according to the Racing Post.

On 20 September Fred Done, Betfred's chairman and co-founder, wrote in The Sunday Times that Betfred had "a verbal agreement to renew our sponsorship of the British Classic horse races for a further three years", and that "if October's budget goes the wrong way on MGD, we will have to walk away from those, too."

Three Years Building a Full Set of Classics

Betfred replaced Cazoo at the Derby and Oaks at Epsom and the St Leger at Doncaster in 2023, and in January 2024 extended the Epsom deal until 2026, according to the Racing Post. In June 2024 the Jockey Club announced that Betfred would sponsor the 2,000 and 1,000 Guineas at Newmarket from 2025 under a multi-year agreement, replacing Qipco and becoming the first sponsor of all five Classics, with a £2 million bonus for any winner of the 2,000 Guineas, Derby and St Leger.

Neither Betfred nor the racecourses have said exactly when each contract ends, and no financial terms have been disclosed.

The Racecourses Are Already Talking to Others

Amy Starkey of the Jockey Club said it was "naturally disappointed" and was "currently in conversations with a number of interested prospective partners". David Leyden Dunbar, Arena Racing Company's director of commercial strategy and partnerships, pointed to "regulatory headwinds" and said: "We remain confident that this won't be the end of Betfred's relationship with British racing." Arena Racing Company says the 250th St Leger in September drew more than 30,000 racegoers, its biggest St Leger Day crowd since 2012.

The Tax That Ended the Deal Is a Shop Tax

Betfred kept the Classics through the move to a 40% Remote Gaming Duty; a five-point rise in MGD tipped it. Done told the Financial Times in September that machines provide half of Betfred's shop profit, so MGD reaches the core of the business. The rise is far short of the 40% Done modelled, yet it ended a deal he had verbally agreed to renew.

Racing's Flagship Races Are No Longer Insulated

A Racing Post analysis found bookmaker sponsorship of British races fell 17% this year, with all-weather racing hit hardest. Betfred's exit carries that retreat to the top of the sport. Betfred itself filled gaps left by sponsors from outside gambling: Cazoo, a used-car company, in 2023, and Qipco in 2025. The obvious fallback, another bookmaker, faces the same tax bills, so the racecourses may have to look beyond gambling.

A Public Exit Is Also an Argument to the Treasury

Sponsorship is discretionary spending, so it is the easiest cost to cut and the most visible. Announced a week after the Budget, Betfred's exit puts the cost of the MGD rise in front of racing's audience and its political allies. HMRC is consulting until 20 January 2027 on who pays MGD, though not on the rate.

The racecourses have until the 2027 Guineas to find new backers, but the pool of bookmakers able to pay is shrinking. The Budget's cost to racing is no longer a forecast: it now has five race names on it.