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UK government could lose £500 million at bingo

It has been revealed that Rank group, the holding company for Mecca bingo, has won a decisive court ruling against the UK Treasury. Judges ruled that Rank had overpaid VAT to the tune of £62 million on takings from slot machines and mechanised cash bingo machines. Ultimately the case hinged on whether similar machines were treated differently because of the services available, something which is illegal under EU laws.

The ruling that, prior to changes in December 2005, machines were treated differently because of the games on offer could ultimately open up the UK government to a £500 million hit from similar claims, with motorway service stations and holiday camps set to benefit. Experts believe there are over 1000 similar actions pending although the Treasury is currently looking at a possible appeal against the ruling.

This could not have come at a worse time for Gordon Brown and the UK government who are literally trying to raise as much money as possible in the short to medium term to assist the economy. If the ruling cannot be overturned we will see around £500 million returned to corporate companies in the UK which will further reduce the finance available to the UK government.

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