A ruling by the European Court of Justice, that call centre services provided by United Utilities to Littlewoods' Bet Direct service did not qualify for exemption from value added tax, could mean that gaming and lottery operators with outsourced operations could face an additional tax bills.
United Utilities locked horns with HM Revenues and Customs over whether the service they provide for Ladbrokes - taking calls and recording bets - should be VAT exempt in the same way that betting and game-of-chance operations are.
And although the ruling specifically referred to outsourced call centre services, some tax experts claimed that there could be implications for the gaming industry.
Robert Crooks, UK head of indirect taxes for Ernst & Young, told the Financial Times: "This will cast doubt on the correctness of Revenue and Customs’ decision to allow retailers to exempt their sales of lottery tickets. But I would not be convinced that it either needs to or should change its policy."
Patrick Walker, UK head of indirect taxes for PwC, the professional services firm, told the Financial Times: "The situation is not absolutely certain. The House of Lords judges could shed more light, but the gambling industry is watching closely. They may have to factor in additional costs."