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HMRC have set out their policy on bingo duty following the High Court ruling in Rank.
The department has sought leave to appeal in the case, but in the meantime the decision has effect across all taxpayers in the same situation.
The taxman is now considering claims for VAT output tax wrongly accounted for by bingo operators on mechanised cash bingo participation fees. In essence, HMRC maintain that their view of the law is correct and that mechanised cash bingo takings remain liable to VAT.
However, both businesses and HMRC need to protect their positions during the litigation.
Businesses which make adjustments for bingo duty may wish to make claims to recover these amounts and appeal their subsequent refusal in the event that the current ruling is reversed in a higher court.
The Revenue does not accept that the High Court ruling extends beyond mechanised cash bingo to encompass par fees charged on all bingo. To protect its position, the department intends to raise protective assessments for bingo duty due in case it is finally determined that VAT is not due on any bingo par fees.
Payment of these protective assessments will not be enforced until and unless the final legal position justifies such action.
For more details, see Revenue & Customs Brief 55/09.
