Racing Victoria will cut prize money and stand down staff in a bid to reduce expenditure during the coronavirus pandemic.

From Wednesday, RV said 40 per cent of its permanent staff would be temporarily stood down or required to work reduced hours.

The RV board and executive team have voluntarily agreed to a reduction in pay of 50 per cent and 20 per cent respectively.

The staff members to be stood down are being encouraged to take accrued entitlements via annual leave and long service leave while those with minimal entitlements will be offered 20 days annual leave in advance.

Starting from next Monday, RV's contribution to the prize money for all Victorian flat and jumps races will also be reduced until further notice.

- Metropolitan - a 20 per cent reduction in prize money contribution per race

- Country - 10 per cent provided that no TAB race is conducted for less than $20,000.

RV said prize money contributions to individual races by racing clubs and sales companies, which predominantly occurs during the major carnivals, would be at the discretion of those parties.

Super VOBIS and VOBIS Gold bonuses will be reduced by 15 per cent in metropolitan races and 7.5 per cent in the country, while next month's The Showdown will be reduced from $1 million to $905,000.

The $500,000 VOBIS Gold Guineas has been reduced by almost $50,000 and other VOBIS Gold premier races will be reduced by 20 per cent in town and 10 per cent in the country.

"The COVID-19 pandemic has had an incredible impact on the world as we know it, affecting livelihoods and our way of life," RV chairman Brian Kruger said.

"Racing is not immune to that and thus we have had to make some incredibly tough decisions today around our workforce and prize money which fuels participation in our industry.

"These are not decisions that we have taken lightly, however the impacts of the past fortnight and the nation's rapidly evolving economic crisis means that we must act now to help soften the blow for Victorian racing.

"It has become clear that this pandemic and the associated economic crisis will have a long-term impact on our industry if we don't seek to mitigate the impact now.

"It is critical for the long-term viability of the industry that we reduce our expenditure to help compensate for the short to medium term reduction we will have in our revenues.

"Equally, this will ensure that we are in the best position to support the industry if a shutdown occurs and to subsequently lead the rebuild of Victorian racing."