Rank has won a High Court ruling today which entitles the group to a VAT
refund from HM Revenue and Customs.
The case has centered around whether VAT was overpaid on games of interval
bingo and certain gaming machines.
In handing down the ruling, the court stated that there was no objective
justification for the differential in tax treatment by HMRC which breached the
European Community principle of fiscal neutrality.
Tony McClenaghan, senior indirect tax partner at Deloitte, said the court’s
decision is unpinned by the principle of fiscal neutrality in Community law.
He said it remains unclear whether HMRC will appeal the decision.
‘…the decision of both the VAT Tribunal and the High Court are clear and
unequivocal and we would expect the Court of Appeal to share this view.
‘The same principles should apply to any taxpayer which has paid VAT on the
income from these activities. Other organisations in the leisure industry should
consider their own grounds to submit claims for overpaid VAT and interest to
HMRC following the guidance laid down by the High Court in this ruling,’ he
A spokesman for HMRC said the department is studying the court’s decision in
detail as there are important legal points to consider before deciding the next
course of action.
‘The High Court’s decision affects all suppliers of mechanised cash bingo and
we will be issuing a HMRC brief shortly advising on how any overpaid VAT can be
claimed,’ he said.
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