This Order, which comes into force on 1st September 2007, amends Group 4 of Schedule 9 to the Value Added Tax Act 1994 to reflect the coming into force in Great Britain of the Gambling Act 2005.

Group 4 of Schedule 9 exempts from VAT certain types of betting, gaming and lotteries. Note (1)(b) to Group 4 contains an exception from that exemption. Betting or gaming falling within Note 1(b) is therefore subject to VAT.

Article 3 substitutes a new Note (1)(b). The previous Note (1)(b) referred to a provision of the Gaming Act 1968, which is repealed by the Gambling Act 2005. The new Note (1)(b) provides that the grant of the right to play a game of chance for a prize will not fall within the item 1 exemption unless the playing of the game falls into one of the categories specified in Note (5).

Article 4 inserts additional Notes (5) to (11). Note (5) specifies the five categories of gaming which are excepted from Note (1)(b). Fees charged for the grant of a right to play those games therefore fall within the item 1 exemption from VAT.

The first category, remote gaming, is defined by reference to remote gaming duty. Sections 26A – 26M (remote gaming duty) are inserted into the Betting and Gaming Duties Act 1981 (c. 63) by Part 1 of Schedule 1 to the Finance Act 2007 (c. 11). It is anticipated that the provisions of Schedule 1 will be brought into force with effect from 1st September 2007.

The other four categories are defined by Notes (6) - (10).

Note (11) contains relevant legislative definitions.

A full regulatory impact assessment has not been produced for this instrument as no impact on the private or voluntary sectors is foreseen.