Tuesday 15th of December 2009
Glad tidings for bingo clubs
It has been a very good week indeed for bingo clubs.
On Wednesday, December 9th, Alistair Darling set forth the details of his pre-budget report 2009, which has since been dubbed the bingo budget.
Amid a blaze of publicity, the chancellor declared that gross profit tax on bingo clubs would be slashed from 22 per cent to 20 per cent following intensive industry lobbying.
But the high-profile announcement overshadowed another important tax change that could further shore up the finances of British bingo clubs.
In June 2009, HM Revenues and Customs (HMRC) lost its court case against a major bingo operator.
The High Court decided that mechanised bingo machines, or mechanised cash bingo (MCB), should be exempt from VAT.
Bingo games avoid VAT bill
But HMRC issued a statement last Tuesday indicating that, as things stand, other types of bingo should also be excluded from VAT.
"Having considered this carefully, HMRC accepts that the judgement has a wider application to other forms of bingo participation games," it explained.
"Claims for VAT accounted for on participation fees for other types of bingo, in addition to MCB, will now be considered."
However, there is a caveat because HMRC will continue to appeal against the High Court's decision.
And if it wins on appeal, bingo club operators that successfully claim VAT repayments will have to return the money to the taxman.
Meanwhile, Alistair Darling's decision to cut gross profit tax has been warmly received by British bingo lovers.
For example, Rita Young, a 74-year-old pensioner from Peterborough, told the Guardian that she welcomed the move.
She explained: "I do go to bingo regularly, it's one of my pleasures."
