Despite the highs of a 5.75 per cent growth in racing turnover to HK$67.7 billion in the season just completed, and the promise of the biggest tax payment to government in 10 years, the Jockey Club remains stymied on its international agenda.

Executive director of racing Bill Nader said the "improved relations with government" in recent months had given new optimism that future talks on commingling would meet with improved understanding.

"The decision by the government to agree to our proposals [to change the way racing is taxed, from turnover to profit-based] has enabled us to introduce the betting rebates, which have offset the activity of illegal operators," Nader said.

"While turnover has gone up in the past two years, after being in decline since 2000, the Jockey Club's share is the same as it was in 2004-05 - it's the government which is in a much better position.

"Just last week, the Home Affairs Bureau took only 48 hours to give us an approval to hold the replacement meeting on Thursday night, and that was ultimately a tremendous success - the highest turnover Happy Valley meeting in six years," Nader said. "So we hope that with this new spirit of respect and co-operation, which is really bearing fruit, we can be given another chance to explain our position on commingling, and avoid the double taxation of bets which currently makes the proposition unviable."

The tax on bets made with overseas operators, and commingled into Hong Kong pools, should theoretically be shared by Hong Kong and the relevant overseas government.

But at present, Hong Kong is insisting on being paid the full share of tax, making it non-viable for other parties and consequently there is no business.

Nader said the Jockey Club was expected to hand the government more than HK$13 billion at the end of this season from all sources combined - horse racing, soccer betting and Mark Six. But commingling remains the elusive dream.

"Hong Kong offers what we believe to be the world's best racing-wagering product," Nader said.

"It is racing of extremely high integrity, it has a high number of average horses per race (12.6), tremendous pool size, quality horses, trainers and jockeys - everything that a punter could want.

"We are very proud of our product but we know we could do much better if we could pursue our international agenda, but we have to get rid of this double taxation."

In his review of the season just completed, Nader said he still found it "quite incredible" that such a small racing jurisdiction could come up with three horses officially recognised as being among the world's top 10.

"There were a lot of highlights but that to me is the most amazing, from such a small horse population we can be home to 30 per cent of the world top 10 in Sacred Kingdom, Good Ba Ba and Viva Pataca. It's quite phenomenal, but realistically it might never happen again," he said.