A new study undertaken by Deloitte's Sports Business Group has revealed that horse racing is currently the second largest sport in Britain, worth more than £3.7bn to the economy.

According to the company's latest Economic Impact Study, UK horse racing generated expenditure of £3.4bn during 2008, when compared with £2.8bn in 2005, while the sector contributed at least £325m in tax. The study is the second of its kind to be produced by Deloitte for the British Horseracing Authority (BHA), which also revealed that the UK's total betting amount on racing is the second highest in the world.

Alan Switzer, director at Deloitte's Sports Business Group, said: "Like all sports, Racing faces a significant challenge as a result of the economic downturn. While sport is certainly not immune from its effects we have seen an encouraging resilience across many sports. "Many of the metrics in this report are likely to experience declines in 2009, but we are confident the sport has the ability to bounce back once economic conditions improve."

Nic Coward, BHA chief executive, added: "Deloitte's study reiterates that British Horseracing, as the second biggest sporting activity in Britain, is a significant contributor to the leisure, agricultural and rural economies in Britain."