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Wednesday, February 04, 2009

VAT Deadline And Gaming Act Update

The Bingo Association have posted a couple of news posts the last couple of days that will be of interest to the operators out there. First up, there's a reminder that all VAT Reclaims for the period between 1973 - 1996 have to be lodged by the cut-off deadline of March the 31st. I have to admit I'm not quite sure what that's about and was wondering if it was related to Rank's massive VAT repayment on MCB games. Maybe someone could clarify that for me?

Speaking about that, there's also a link to the HMRC's brief re the Mecca Bingo VAT case. The brief states the HMRC believes that it is in the right (well they would say that) and they are expecting the case to go to the high court in March or April of this year, and that there will be a further tribunal to explore this issue to be held in October 2009. If the above VAT reclaim is related to this, and operators can get back overpayments on a 23 year period, it could be a massive windfall. I'm not sure if that's the case though, so don't quote me on that. I like bingo, not tax stuff...

Finally, there's also a mention of the amendments to the 2005 Gambling Act, regarding the raising of limits on number of high stake machines allowed in clubs. According to the Bingo Association, the amendment has been approved in Parliament and Lords, but is just waiting for a signature from Gerry Sutcliffe, the Minister who's been dragging his feet on getting this sorted for almost a year now. If you're an MP or work in the Houses of Parliament, and see him in the corridor, give him a nudge, lend him a biro and send him on down to the signing room will you?

Posted at 11:15 PM |

2 Comments:

Anonymous bingosupermarket said...

We operate a few clubs in the UK and can confirm that most members of the Bingo Association have lodged the VAT claims for the period you stated. The question is whether the Government could legally charge VAT on MCB as the European rulings would suggest this may not be legal hence the decision has been made in Mecca's favour. The decision only allows Mecca to stop paying the VAT and will not incur charges as they have won the case subject to appeal. If Mecca lose the appeal then they would have to pay the reclaim back but will not have to pay penalties as they have acted in accordance with the rulings and procedures set out for them. However this does not give an automatic right for everyone else so we still have to continue paying the VAT although many companies have decided to run the risk of not paying. If the appeal is upheld and we are to continue paying VAT everyone except Mecca who chose to reclaim or not pay could face financial penalties and interest normally charged at a flat rate of 5%.
The long and the short is that if Mecca win, we then have an automatic right to claim our tax back as we would simply point out the Mecca ruling. Other arguments for main stage bingo and even fruit machines are also being fought out and further decisions will be made in due course.
There is a big sting in the tail and here it is when you talk about VAT reclaims. You cannot give back a VAT reclaim for the benefit of enrichment. If we say had a reclaim for £1,000,000 we could not simply claim this money, stick it in the bank and have a nice holiday, we will then have to justify receiving such a benefit and head into the murky waters of trying to have to explain how we will use it or why we deserve it as daft as it sounds.

5:56 PM  

Blogger Dio Bach said...

Right! Thanks for that insightful information, it will be interesting to see how this all pans out for the industry.

8:44 AM  

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