Rank and HMRC back at the Tribunal over VAT monies

The Rank Group Gongman tax
THE RANK GROUP GONGMAN IN MOVIE-SCREEN ACTION
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Rank seem to have pulled their old gongman out of the archives and the former symbol of the gaming giant is banging that tam tam like crazy. With one victory of £42.5 million under its belt, the Group is back at the Tribunal this week for another return of VAT monies incorrectly taken by HMRC. And it could mean so much more for the broader industry – possibly £1 billion plus more?

 

It may have been a whisper in terms of its publicity, but the First-Tier Tribunal Tax Hearing schedules released for the 9th and 16th of November could end up sounding more like a nuclear bomb exploding. ‘16 November 2020, 10am, The Rank Group/ 2016 G1 Ltd v HMRC, Case Ref: TC/2013/04417 & others; Judge G Sinfield’ – reads the schedule for this week.

The findings in some months time could read like a blood-fuelled drama if the evidence given at these hearings by industry experts is accepted, and it’s not looking good for HMRC.

Having lost an almost identical claim at the Upper Tribunal on tax due on S16/21 machines for the period up to 2005 back in May, this latest case – relating to VAT due on S34 machines from 2005 to 2013 – is expected to go the same way.

Rank have been both resilient and right in their fight for justice in the tax system. That may sound a little grand, but when their success has managed to ripple all the way down to small AGCs, WMCs and clubs – it’s a massive victory. One estimated at circa £1 billion plus in monies due for refund.

According to one source, there are something like 1,500 claims against HMRC riding on this current case. Many of these claims have already been lined up by legal firms ready to pounce on the First-Tier Tribunal’s decision.

And the evidence is almost identical to the case earlier this year which HMRC accepted and decided not to appeal against.

Bacta’s John White explained: “It is simply down to whether or not the principle of fiscal neutrality applies in the case of different types of amusements machines which was first established in the European Court after the Linnewebber Case.”

Essentially, he observed, it’s a requirement of law that if you tax one product in a particular way, you should tax similar products in the same way.This, the law says, is fiscal neutrality.

HMRC were anything but neutral. Since 2003, the tax office has been engaged in court battles with the industry on this matter impacting thousands and thousands of business in the process. But it’s the tenacity and deeper pockets of the Rank Group, plus a number of other high profile claimants from the betting sector, and many smaller operators and WMCs, that has driven the two decade long campaign to this second tribunal, and final resolution.

Nothing is ever certain in legal cases, but the evidence currently being provided does align with previous judgements. Bacta, for example, have been liaising with legal teams to provide them with expert knowledge of games, and key figures in the industry have given crucial evidence to the tribunal this week and last.

The industry is hoping for the best.

Winning the case was the easy part, getting the money …..

Rank settlement may have put WMC claims at “severe disadvantage”, says Slasberg

Many working men’s clubs standing behind Rank’s tax claim to HMRC have been put at a “severe disadvantage” now the lead claim has been settled, says Barry Slasberg.

Rank, the lead claimant in the long standing case, reported that their claim for the sum of £22.5 million had been settled with HMRC in March, however Slasberg states that the Financial Secretary to the Treasury is still insisting that there has been no priorisation to any particular claimant.

Barry Slasberg
Barry Slasberg

“It is obvious that the effect of the lead case being paid off is that Rank were satisfied and the thousands of cases standing behind Rank were put at severe disadvantage,” said Slasberg. “The fact is that HMRC should have initiated payment to all claimants without claims having to be made by the taxpayers. HMRC knows the exact value of each claim and just has to add interest. It is part of their mandate to ensure no taxpayer is disadvantaged by overpayment of tax.”

Slasberg, who was a secretary for Kingsley Park WMC in Northampton, has been campaigning against HMRC on behalf of all the WMCs standing behind Rank’s claim for over six years. With Rank’s claim now settled, and HMRC issuing a claim briefing to further claimants in what Slasberg calls an “obvious attempt at procrastination and putting off claimants”, the fight continues for Slasberg as he urges WMCs across the country to make sure they get every penny back they deserve. And the veteran WMC figure remains angry describing HMRC’s posturing as “disgusting”. Given Slasberg’s body of criticisms against the tax authority on this matter, this may sound pretty mild; but the fighting spirit is as strong as ever.

 

 


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