Rank is the operating company for Mecca Bingo, both land bingo clubs and online; Blue Square is another one of their gambling operations with a land as well as online presence. It was recently Full House for this company, and we'll bet a penny to a pound that their CEO stood up and shouted B I N G O! The European Court of Justice has ruled in favour of their VAT claim. This matter has been continuing for rather a long time, and in essence it concerns the fact that Rank has been overpaying VAT for a specific type of bingo offering (mechanised cash bingo) as well as for certain other gaming machines. The claim was in an amount of £253.4 million including interest!

Now…how's that for hitting the jackpot?

This news rose Rank shares by approximately 10% which is great news for shareholders. The company made comment that the new ruling confirms findings of consecutive UK courts in regards to Bingo VAT claims. They are also considering the implications of this ruling in respect of an amusement machines claim – a claim which is peanuts in comparison, but still at £30.8 million plus interest, is not to be sneezed at.

The long-running dispute with HMRC, saw the tax and customs agency appeal to the European Court of Justice, after – as we said – more than one consecutive ruling by UK courts on behalf of Rank. The European court is in agreement with Rank's argument, but has reservations regarding the VAT claim for games machines. This is a complex legal position, but does come about after the ECJ issued a sequence of clarifications over VAT legalities for bingo and slots

Not only were rebates forced for Rank, Gala Coral, Whitbread, Top Ten Bingo and JD Wetherspoon has also all benefitted. However, in terms of the position for slots machines, HRMC is expected to attempt to rake-back over £100m in VAT rebates it has allegedly already paid to bingo halls and pub operators - under the guise of unfair tax treatment.

Rank's legal argument was based on the fact that for years UK authorities were unfairly biased in their approach to VAT. In other words, they demanded VAT payments from some classes of gambling machine but not from others. They claimed that this action was "in breach" of European Treaty rules for "fiscal neutrality". HRMC says that now that the courts have clarified their position on the rules, they will study the judgement to assess any further implications. According to EU Treaty Rules and Regulations – fiscal neutrality means that goods and services of a similar kind or the same, must have VAT charged at an equal rate to prevent distortion of competition. Ultimately this means that Her Majesty's Revenue and Customs has breached the rules.

Tax experts have explained that the HMRC has been desperately resisting the Fiscal Neutrality argument, but to no avail. The ruling sets a major precedent for UK tax payers who are dealing with discriminatory VAT practices.