The draft regulations for the new tax have revealed it will apply to Category C machines (“fruit machines”) and Skills With Prizes machines delivering a prize over eight pounds.
will require licensees to complete a new return every quarter in addition to their VAT return - a cost which the British Beer & Pub Association (BBPA) estimates will cost £200 per pub, per year.
The BBPA, which attended an implementation working group for the tax at HMRC’s offices in London today, said it is crucial that the new regime does not penalise pub businesses and does not introduce unnecessary costs and burdens.
BBPA director of pub & leisure, Martin Rawlings, who attended the meeting, said: “I am pleased that HMRC has asked us to be involved in this working group. We will work with them to ensure that the transition to the new tax arrangements is as smooth and efficient as possible, now that the Treasury has decided to bring in this new regime.
“As new tax returns mean more red tape, it is vital that pubs are not left worse off under the new system. In order for the tax to be revenue neutral, it needs to be lower than the current rate of VAT – The MGD rate needs to be nearer 15 per cent, because of the knock-on effect of VAT and the extra administration costs. We continue to press these points with the Treasury, to ensure the new regime is a fair as possible for pubs.”
The tax rate and legislation will be announced in the Budget on 21 March, with implementation on 1 February 2013.
Operators will need to register for payment of the new tax before the end of the year. HMRC will set up a website providing general advice on the process.