The Highland Council v Her Majesty's Revenue & Customs

Facts

The Highland Council operated leisure facilities across the Highlands: 15 council facilities, 11 of them including swimming pools, thirteen of which were associated with the Highlife card, together with 10 not-for-profit community facilities, 7 including swimming pools, which the Council supported and five of which took part in the Highlife scheme. Because those facilities were not adequately used by the inhabitants, the Council devised schemes to increase take-up, culminating in the Highlife card. Three types of card were issued, all plastic and similar in appearance and usable at any Highland library to borrow books. The "budget" card, issued free, admitted the holder, a partner and dependants under 18 who qualified for government benefits to any facility for 50 pence. The second card, also free, required payment of the standard admission price unless the holder was under 18, in full-time education or over 60, and could be loaded with cash. The third, the "all inclusive or standard" card, gave unlimited access for a year to all leisure centre run activities for a monthly direct debit or an annual sum, at individual and family monthly rates of £13.35 and £18.45. The Commissioners decided that the income from the cards was to be standard rated, and the Council appealed.