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VAT on bingo and amusement machines - HMRC update

Following the successful challenge by Rank at the ECJ over the treatment of VAT on bingo and amusement machines (see LINK), HM Revenue and Customs yesterday issued a Brief as their immediate response to the decision which can be found here.

It’s commentary on the implications of the decision follows:

‘Bingo - In view of the CJEU’s judgment, HMRC accept that the issue is now resolved in respect of bingo and our appeal in respect of this will be withdrawn. All valid claims received, further to Brief 75/09, have been paid, so the decision not to continue with litigation in respect of bingo means that HMRC will not be seeking any repayment of these amounts.

Gaming machines - HMRC believes that the judgment of the CJEU does not provide a final determination of the domestic litigation. Further consideration of the gaming machine appeals will now have to take place, with the parties and the domestic courts using the judgment of the CJEU for guidance. Accordingly, our appeals will continue. Brief 11/10 provided advice about claims relating to VAT accounted for on gaming machine takings between November 1998 and December 2005 and all valid claims have been paid. The judgment does not extend the findings of the UK courts to any other period, so any claims for periods prior to November 1998 and post-December 2005 will continue not to be paid.

To summarise: although the position in relation to bingo claims has now been resolved, HMRC are to continue to contest Rank’s claim in relation to overpaid VAT in relation to gaming machines.  It is anticipated that this matter will be brought back before the UK courts in the first half of 2012.