Jumpman Gaming Ltd v The Commissioners for HMRC

Facts

Jumpman Gaming Ltd operated online gaming platforms on which customers played remote games of chance. Prizes could include cash, bonus credits or free spins on other games. Under its "Welcome Offer", a customer who opened an account and made a qualifying deposit received a free spin of the "Mega Reel" (the "Welcome MR Spin"). The Mega Reel was itself a game of chance, and its prizes included free spins on other Jumpman games such as Fluffy Favourites, King Kong Cash and Chilli Heat (the "Further Free Spins"). HMRC assessed Jumpman to approximately £13.2 million of Remote Gaming Duty for accounting periods between 1 July 2018 and 31 December 2022. The appeal was argued on a representative sample of transactions. The dispute turned on the freeplay provisions inserted by the Finance (No. 2) Act 2017. Jumpman argued that the Welcome MR Spin fell within section 159(4) of the Finance Act 2014, and that the Further Free Spins were excluded from charge by section 159A(4) and (5) of the Finance Act 2014. The First-tier Tribunal (Tax Chamber) accepted HMRC's construction and dismissed the appeal. It held that the Welcome MR Spin was a free game rather than a game played for free, and that the Further Free Spins did not qualify for the exclusion. It had declined to consider HMRC's 2016 consultation materials. With the FTT's permission, Jumpman appealed on three grounds.