TaxCorporate TaxTesco loses VAT voucher appeal

Tesco loses VAT voucher appeal

The UK's largest supermarket has lost its appeal over the tax treatment of shopping vouchers.

Link: Customs faces VAT rebate crisis

The Court of Appeal judges rejected Tesco’s claim that the face value of vouchers, issued in its Clubcard scheme, should be deducted from the shelf-price of goods that shoppers bought in order to earn the vouchers and only be included in VAT calculations when the vouchers were redeemed.

The Court of Appeal judges found unanimously in favour of Customs and Excise and refused the retailer leave to take the case to the House of Lords, despite Tesco’s argument that this was a case with potentially significant impact on other reward schemes in the supermarket sector.

Tesco, which could still apply to the House of Lords direct, said it is considering the judgment.

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