Online gambling company Sportech PLC today provided an update regarding its long-standing legal dispute with Her Majesty’s Revenue & Customs. According to the latest information released, HMRC has paid Sportech the total amount of £93 million in relation to a claim the gaming operator had filed for VAT repayment for a game it had offered decades ago.
The ‘Spot the Game’ had been provided for more than 50 years and enjoyed quite a lot of popularity among gambling customers. Being a game of chance, Sportech argued that it should be exempt from VAT tax. The gaming company filed a lawsuit claiming that it should be paid £40 million plus added interest, the amount it paid in VAT within the period between 1979 and 1996.
Sportech filed its first claim back in 2009. It was heard by the First-Tier Tribunal (Tax Chamber) in October 2012. It was announced in March of the next year that the Tribunal had ruled in the operator’s favor. HMRC then applied to the Upper Tribunal (Tax and Chancery Chamber) to appeal the ruling and was granted permission. The new claim was heard in April and May, 2014; in September of that year, the Upper Tribunal ruled in HMRC’s favor.
Early in 2015, Sportech announced that it would appeal the matter to the Court of Appeal. A hearing was held in April 2016. Early in May, the Court of Appeal ruled in favor of the operator. A few days later, HMRC sought permission to appeal to the Supreme Court but was denied such permission. Early in June, it was announced that HMRC has eventually filed an appeal application to the Supreme Court. It is yet to be determined whether the authority would be allowed to appeal.
According to the May 2016 ruling, HMRC was to pay £97 million to Sportech. As mentioned above, the operator has already received £93 million. The remaining £4 million would be paid in case the Supreme Court rules in Sportech’s favor.
However, if the Supreme Court allows HMRC to appeal and then rules in its favor, the gambling company will have to return the money plus any accumulated interest. A final ruling is likely to be announced late in 2017 or early in 2018.
