This week marks a win for the UK gambling machine owners as HM Revenue and Customs, the tax authorities in the UK, decided not to appeal a test case that they lost in June.
Rank Group, owner of Grosvenor Casinos and the Mecca Bingo chain, had emerged victorious in the courts and then at a tribunal over Value Added Tax applied on slot machines.
When the Revenue and Customs decided not to appeal the outcome of the court case, the outcome would be that Britain's betting companies, pubs and amusement arcades will receive a substantial sum in tax refunds that would possibly amount to billions.
The court had decided that the affected gambling operators were unfairly charged VAT by the government on some of their slot machine income. In the case of the Rank Group, the company could be refunded around £80 million.
The tribunal decided that they should not have been charged VAT on their machines between 2005 and 2013 since they were similar to VAT-exempt gambling items such as casino roulette wheels and online gambling games.
The tribunal followed a court case in April 2020 that found in favor of the betting company Betfred, which operated fixed-odds betting terminals. Betfred should also be entitled to receive a refund of its VAT. According to its 2020 corporate accounts, the Done family-owned betting business reported that it had secured an exceptional credit charge worth £99 million from its VAT appeal.
It is estimated that up to 1,000 other businesses are due a refund.