by Anton Johan
HM Revenues and Customs was forced to pay Rank Plc £42.5 million in Value Added Tax Refunds this week, following a High Court ruling.
According to Rank, tax authorities made inconsistent VAT claims from Rank's network of businesses from 2002, and the group applied to the courts to have much of the money returned.
Rank overpaid just over £16.1 million on bingo games between the years 2004 and 2009, as well as £26.4 million in VAT for amusement machines for three years, beginning 2002.
Rank appealed to tax courts, before the case finally reached the High Court and the latest ruling was given.
However, Rank is being cautious and has warned that the matter may still not be over.
HM Revenues and Customs have already appealed the ruling and have a hearing with the European Court of Justice sometime next year.
Rank issued a statement on the ruling which read as follows:
"The claims concern the inconsistent application of VAT to revenue from Rank's businesses, Mecca Bingo and Grosvenor Casinos. It is Rank's contention that this practice contravened the European Union principle of fiscal neutrality, which requires that supplies that are the same or similar should not be treated differently for VAT purposes."
"This position was confirmed in the European Court of Justice Finanzamt vs Linneweber in 2005," continued the statement. "In June of 2009, the High Court, confirming the decisions of the VAT and Duties Tribunal, now the First Tier Tribunal's tax chamber, accepted that HMRC had breached this principle and that therefore Rank's claims should be accepted."
If HMRC wins their appeal, Rank may be forced to pay back the money it landed this week.
