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HMRC to appeal High Court VAT decision for Mecca’s Rank

  • 08 Jul 09
  • Written by Charlotte Widmore

Mecca BingoIt’s almost a month to the day that we reported on a small victory for bingo with the success of  Rank, the parent company of Mecca Bingo, and their case in the High Court regarding the overpayment of bingo VAT to HMRC.  We also stated in the article published on our site on 9th June that there was every likelihood that HM Revenue and Customs would appeal against the bingo VAT decision, which could eventually cost the Inland Revenue in the region of £500m of reclaimed bingo tax if other gaming operators decided to follow the same route as Rank.  It would now appear that HMRC has in fact decided to appeal against the High Court decision as the following short press release from Mecca Bingo ‘s parent company Rank states.

7 July 2009

HMRC appeals High Court ruling

The Rank Group Plc (‘Rank’ or the ‘Group’) has been advised that Her Majesty’s Revenue & Customs (‘HMRC’) has lodged an appeal against last month’s High Court ruling on the overpayment of VAT on games of interval bingo and on gaming machines.

In May and August 2008, the VAT & Duties Tribunal upheld Rank’s respective claims that the inconsistent application of VAT to games of interval bingo and to gaming machines contravened the European Union principle of fiscal neutrality. These rulings were in turn upheld by the High Court in June 2009, following an appeal from HMRC.

The case will now go to the Court of Appeal, although at present no date has been set for the hearing.
In November 2008, Rank received from HMRC £59.1m in overpaid VAT, relating to the ruling on interval bingo. The Group has not as yet received any repayment in respect of its £26.0m VAT claim on gaming machines.

Rank had anticipated that HMRC would need to lodge an appeal by 29 June 2009 but this deadline was subsequently extended to 6 July 2009.

As our previous article stated the case was brought about by Mecca Bingo’s Rank Group due to an anomaly in the Tax rules.  This anomaly taxes some gaming machines and bingo games differently which is considered illegal in Europe.  We are unsure how this latest development will affect Ranks position but will of course keep our readers fully informed of any further developments in this case. The full press release can be read by following this link.

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