Cash ma­chine court rul­ing set to de­liver £500m pay­out to big stores

The Guardian - - FINANCIAL - Richard Part­ing­ton

Three of Bri­tain’s big­gest su­per­mar­ket groups have won a le­gal vic­tory worth up to £500m fol­low­ing a court bat­tle over busi­ness rates on cash ma­chines.

The court of ap­peal ruled yes­ter­day that ATMs lo­cated on the in­side and out­side of stores should not be li­able for ad­di­tional busi­ness rates, which are a form of prop­erty tax on busi­nesses.

Sev­eral big re­tail­ers in­clud­ing the Co-op, Sainsbury’s and Tesco had fought in the courts against the tax rules set by the Val­u­a­tion Of­fice Agency – the arm of HMRC re­spon­si­ble for set­ting busi­ness rates – which had claimed ATMs should be ad­di­tion­ally as­sessed.

The ver­dict means the su­per­mar­ket chains are in line for a wind­fall from tax re­funds, which the prop­erty ad­vi­sory com­pany Col­liers es­ti­mates will be jointly worth about £500m.

The case dates back to a 2013 de­ci­sion by the gov­ern­ment to charge rates on “hole-in-the-wall” cash ma­chines, which was back­dated to 2010.

Although the re­fund is small com­pared with the £1.8bn an­nual busi­ness rates li­a­bil­ity for the four big­gest super­mar­kets – Asda, Mor­risons, Sainsbury’s and Tesco – it does how­ever come at a time when re­tail­ers are fac­ing grow­ing pres­sure from on­line ri­vals who pay less money in tax.

A Co-op spokesper­son sug­gested the vic­tory would help the re­tailer keep cash ma­chines at its stores.

“The case had threat­ened the vi­a­bil­ity of the ATM net­work and risked the fu­ture of much-needed bank­ing ser­vices across com­mu­ni­ties.”

Banks have been heav­ily crit­i­cised by MPs for clos­ing hun­dreds of branches in re­cent years, par­tic­u­larly in ru­ral ar­eas, and of­ten leav­ing con­sumers with lit­tle op­tion but to use cash ma­chines that charge a fee.

Labour es­ti­mates that 60 bank branches and 250 free cash ma­chines close each month, and has promised to ban ATM charges and to block clo­sures of branches.

The ap­peal court re­fused to grant the Val­u­a­tion Of­fice leave to have the case heard in the supreme court, although it can pe­ti­tion for an ap­peal.

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