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RANK PLC VAT REFUND IMPLICATIONS EXAMINED
Rank plc's success in fighting for a VAT refund on bingo operations could have expensive financial implications for the British government, reports the BBC in a follow-up piece.
The article notes that the High Court ruled that Rank was entitled to GBP 62 million from value added tax overpaid on slot machines and bingo takings over a five year period plus interest. This follows some UK gaming and bingo machines being exempt from VAT while similar machines were subject to the tax - a disparity illegal under EU law.
But the report points out that the judge had commented that there were over a thousand similar claims outstanding, and accounts firm Deloittes has estimated that GBP 500 million could be returned, with pub chains, bookmakers and amusement arcade operators among those having made similar claims to get VAT repaid.
Those running fruit machines at motorway service stations and holiday camps could also be in line for refunds, Barney Horn, indirect tax partner at Deloitte, told the BBC. Principles set out by the European Court of Justice "require the same or similar services to be treated in the same way for the purposes of VAT" Horn said.
There was a disparity in tax rules until until December 2005, when HMRC amended the law to tax all of these gaming machines.
One of the claims relates to interval bingo - an mechanised game played during gaps between rounds of traditional bingo.
The other claim relates to gaming machines, or slot machines. in Mecca Bingo clubs and Rank's Grosvenor casinos.
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