UK government will have an alternative to the current horseracing levy system in operation by April 2017, according to culture secretary John Whittingdale, which could include bringing offshore revenue in line with onshore revenue.

The new system would replace the current levy system, where bookmakers pay a levy at a rate of 10.75% on gross profits from UK racing, as per the terms of the Betting Levy Act of 1961.

Operators are currently not bound to pay tax on any revenue generated from offshore online betting, so the issue is in some ways similar to that of the point-of-consumption tax, implemented in December 2014, which changed tax legislation and now requires operators to pay a 15% tax on remote gaming duty, regardless of where they are based.

Whittingdale said in a debate in the House of Commons: "Our aim is to introduce a new funding arrangement for British racing by April 2017.

"We will create a level playing field for British-based and offshore gambling operators, and ensure a fair return from all bookmakers to racing, including those based offshore.

"Racing will be responsible for making decisions on spending the new fund and we'll be making further announcements shortly."

Chancellor George Osborne announced in March last year that the government was looking to introduce a “racing right”, which would be a charge operators would have to pay to take bets on horseracing in the UK.

The British Horseracing Authority (BHA) currently has an Authorised Betting Partner initiative, where operators can make a contribution to the levy from their offshore revenue in order to not lose promotional benefits, such as sponsorship opportunities at racetracks.

BHA chief executive Nick Rust said: “We now have a great opportunity to bring together racing and betting in tackling the sport's funding issues for the benefit of all parties, and this is something that we are actively pursuing.”