Rank Won The Battle
23rd May, 2008
Rank Group Plc, is the UK gaming giant, won the legal dispute with the tax authorities yesterday after filing a claim for unfair taxation being applied to their revenue.
The company which owns Grosvenors Casinos, the largest land-based casino chain as well as Mecca Bingo, one of the two biggest bingo operators in the UK, has acquired £36 million VAT rebate following the court ruling.
This case seems to be starting a whole movement which will include the gaming operators, who consider themselves liable for similar rebate. Some analysts say that the total cost of these rebates could come down to £100 million demanded from the government for unfair taxation.
Tony McClenaghan, head of indirect tax at Deloitte, said that this case is most likely to be very beneficial for the bingo operators and could earn the industry a bit of cash.
According to Times Online, Gala Bingo, which is the UK’s bingo biggest operator, has already filed a claim with HM Revenue & Customs (HMRC). Gala Bingo as 160 clubs around the UK, more than any other bingo operator.
Rank’s case made a huge development in the law. VAT and Duties Tribunal ended up with a decision that charging VAT on interval bingo game, as HMRC's was doing is in fact against the European law and therefore should not have been applied.
This ruling was entirely concerned with mechanised cash bingo games, or cashline games: the bingo games that are carried out between the main bingo sessions.
Rank Group managed to prove that charging VAT only on some cashline games was discriminative practice that breached European principle of fiscal neutrality. The principle states that the tax authorities in European countries must apply consistent VAT approach to services that are similar or exactly the same.
By Elena
