Gaming and racing minister Richard Face, said the abolition of the 1 per cent tax on racing would save bookmakers $2.3 million a year.

This would mean NSW bookmakers would become viable and competitive with bookmakers in other states, especially Queensland and Victoria.

But Lightning Ridge Racing committee president, Peter Waterford, said the effects to end the tax that bookmakers pay is another wedge to get rid of the smaller race clubs in NSW.

He said while it would make the bookmakers happy, the Government needed to consider that without the race meetings, the bookmakers would not be in existence.

He said a lot of the clubs would miss out on significant income.

"A year ago we received a $22,500 TAB grant, and this year we only got $15,000 for the races on Saturday."

"What they're (the government) trying to do is get rid of the smaller race meetings, I can see it written on the wall all the time," he said.

He said the Government for the past five years had been trying to get all the small towns in the region to run their race meetings in Dubbo.