VAT treatment of supplies from different kinds of gambling machines

The taxpayers supplied gambling machines to retail customers.

Rank’s claim related to takings from slot machines (known as section 16/21 and section 31/34 machines after the relevant provisions in the Gaming Act 1968 and the Lotteries and Amusements Act 1976) between 2002 and 2005. During this time takings from fixed odds betting terminals (FOBTs) and section 16/21 machines were exempt from VAT. Supplies through section 31/34 machines were standard rated. Rank therefore claimed a repayment of VAT on the section 31/34 machines on the basis that the machines were similar and treating them differently was contrary to the EU law of fiscal neutrality.

Done Brothers’ and Tote’s claims concerned takings from FOBTS between 2005 and 2013 during which time gambling using this kind of machine was standard rated although similar games played online in a casino or on an electric machine were exempt. They claimed that the takings...