Jumpman Gaming has successfully overturned £13.2 million in Remote Gaming Duty assessments regarding free promotional spins, thanks to a ruling from the Upper Tribunal. This decision effectively nullified their tax liabilities.
The company had offered customers a welcome bonus that included one free spin on Mega Reel with a qualifying deposit, which could also unlock additional bonuses, including free spins on other games. The HM Revenue and Customs (HMRC) contended that these subsequent free spins were subject to taxation. In contrast, Jumpman maintained that the free spins did not generate any Remote Gaming Duty liability.
The controversy centers on the interpretation of Section 159A(4)(b), which provides an exemption for promotional and free gaming. HMRC interpreted "the gaming" in a narrow context, suggesting it referred specifically to gaming that does not require payment, thus necessitating the tracing of each spin through different transactions. Jumpman countered by asserting that the term should encompass remote gaming in a broader context, eliminating the need for such tracing.
While the Upper Tribunal recognized the linguistic validity of HMRC's viewpoint, it favored Jumpman's interpretation. The ruling established that the initial welcome spins were exempt from taxation and that the free spins available thereafter were also covered under this exemption. Consequently, the tribunal ordered that the financial assessments be reduced to zero in accordance with Section 16(5) of the Finance Act 1994.
Meanwhile, the Betting and Gaming Council (BGC) continues to lobby lawmakers regarding the 40% tax imposed on revenues.
