The UK-based operator, which owns several big-name brands such as Grosvenor Casinos and Mecca Bingo, claimed a refund of VAT paid on slot machine income in the seven-year period from April 2006 to January 2013.
A settlement has now been reached, which includes interest that Rank expects will amount to roughly £5.5m. Corporation tax will also be owed on both sums, to be paid at a 19% rate. Rank said it “intends to use the proceeds to strengthen its balance sheet and to fund continued investment in its transformation programme.”
This development follows a decade-long dispute between Rank and Her Majesty’s Revenue and Customs (HMRC), which culminated in July 2021 when the First-tier Tribunal — a body which hears appeals from citizens against decisions made by government departments — ruled in favour of the gambling firm’s claim.
The Tribunal’s judgement found that operators were not liable for VAT on a wide range of betting machines because they were similar in nature to tax-exempt devices such as casino roulette wheels and games found on online gambling sites.
HMRC declined to appeal against the ruling, and a 60-day extension was agreed for both parties to resolve an exact sum. This followed on from a verdict when Betfred was also awarded a tax rebate for similar reasons.
This news comes after Rank published its results for the first quarter of the 2021/22 fiscal year, in which it saw its net gaming revenue grow by 69%.
