Value Added Tax Act 1994

23 Gaming machines.U.K.

(1)Where a person [F1gambles] by means of a gaming machine, then for the purposes of VAT (but without prejudice to subsection (2) below) the amount paid by him F2... shall be treated as the consideration for a supply of services to him.

(2)The value to be taken as the value of supplies made in the circumstances mentioned in subsection (1) above in any period shall be determined as if the consideration for the supplies were reduced by an amount equal to the amount (if any) received in that period by persons (other than the person making the supply and persons acting on his behalf) [F3gambling] successfully.

(3)The insertion of a token into a machine shall be treated for the purposes of subsection (1) above as the payment of an amount equal to that for which the token can be obtained; and the receipt of a token by a person [F4gambling] successfully shall be treated for the purposes of subsection (2) above—

(a)if the token is of a kind used [F5to use] the machine, as the receipt of an amount equal to that for which such a token can be obtained;

(b)if the token is not of such a kind but can be exchanged for money, as the receipt of an amount equal to that for which it can be exchanged.

[F6(4)In this section “gaming machine” means a machine which is designed or adapted for use by individuals to gamble (whether or not it can also be used for other purposes).

(5)But—

(a)a machine is not a gaming machine to the extent that it is designed or adapted for use to bet on future real events,

(b)a machine is not a gaming machine to the extent that—

(i)it is designed or adapted for the playing of bingo, and

(ii)bingo duty is charged under section 17 of the Betting and Gaming Duties Act 1981 (c. 63) on the playing of that bingo, or would be charged but for paragraphs 1 to 5 of Schedule 3 to that Act, and

(c)a machine is not a gaming machine to the extent that—

(i)it is designed or adapted for the playing of a real game of chance, and

(ii)the playing of the game is dutiable gaming for the purposes of section 10 of the Finance Act 1997 (c. 16), or would be dutiable gaming but for subsections (3) and (4) of that section.

(6)[F7For the purposes of this section—]

(a)a reference to gambling is a reference to—

[F8(i)playing a game of chance for a prize, and

(ii)betting,]

(b)a reference to a machine is a reference to any apparatus which uses or applies mechanical power, electrical power or both,

(c)a reference to a machine being designed or adapted for a purpose includes a reference to a machine to which anything has been done as a result of which it can reasonably be expected to be used for that purpose,

(d)a reference to a machine being adapted includes a reference to computer software being installed on it,

(e)“real” has the meaning given by section 353(1) of [F9the Gambling Act 2005],

(f)“game of chance” [F10includes—

(i)a game that involves both an element of chance and an element of skill,

(ii)a game that involves an element of chance that can be eliminated by superlative skill, and

(iii)a game that is presented as involving an element of chance,

but does not include a sport,]

(g)“bingo” means any version of that game, irrespective of by what name it is described.

[F11(h)“prize”, in relation to a machine, does not include the opportunity to play the machine again,

(i)a person plays a game of chance if he participates in a game of chance—

(i)whether or not there are other participants in the game, and

(ii)whether or not a computer generates images or data taken to represent the actions of other participants in the game.]

(7)The Treasury may by order amend subsections (4) to (6).]

Textual Amendments

F1Word in s. 23(1) substituted (with effect in accordance with s. 16(6) of the amending Act) by Finance Act 2006 (c. 25), s. 16(2)(a)

F2Words in s. 23(1) repealed (with effect in accordance with s. 16(6) of the amending Act) by Finance Act 2006 (c. 25), s. 16(2)(b), Sch. 26 Pt. 2

F3Word in s. 23(2) substituted (with effect in accordance with s. 16(6) of the amending Act) by Finance Act 2006 (c. 25), s. 16(3)

F4Word in s. 23(3) substituted (with effect in accordance with s. 16(6) of the amending Act) by Finance Act 2006 (c. 25), s. 16(4)(a)

F5Words in s. 23(3)(a) substituted (with effect in accordance with s. 16(6) of the amending Act) by Finance Act 2006 (c. 25), s. 16(4)(b)

F6S. 23(4)-(7) substituted for s. 23(4) (with effect in accordance with s. 16(6) of the amending Act) by Finance Act 2006 (c. 25), s. 16(5) (with s. 16(7))