Jumpman Gaming wins £13.2m appeal over free spins tax

Jumpman Gaming has been able to overturn £13.2m worth of Remote Gaming Duty assessments in relation to free promotional spins after an Upper Tribunal ruling which has effectively reduced the tax liabilities to nil. Jumpman offered a welcome bonus of one free spin on Mega Reel upon a qualifying deposit which can in itself offer other bonuses including free spins on other games. The HMRC has argued that these free spins thereafter are taxable while Jumpman argued that the free spins had not created any Remote Gaming Duty liability. The matter revolves around the interpretation of Section 159A(4)(b) where an exemption is given on promotional and free gaming. The HMRC interpreted the term “the gaming” strictly, referring specifically to gaming with a waived payment while under this view every spin would need to be traced through the different transactions. Jumpman asserted that the term meant remote gaming in a wider sense than that and that no tracing was necessary. The Upper Tribunal acknowledged that HMRC’s understanding was linguistically valid, but opted for Jumpman’s understanding. The tribunal ruled that first welcome spins were not taxed and the free spins after the welcome spins were included in the statutory exemption. It, therefore, ordered to reduce the assessments to zero as per Section 16(5) of the Finance Act 1994. The Betting and Gaming Council (BGC) is still trying to persuade lawmakers about the 40% tax on revenues.