Games of Chance (GST/HST) Regulations

Section 7

Subsection 7(7)



Subparagraph (ii)

See Also

Commissioners for Her Majesty’s Revenue and Customs (Appellant) v London Clubs Management Ltd (Respondent), [2020] UKSC 49

gaming profits from bets staked did not include chips and vouchers distributed free of charge for promotional reasons

It was held that non-negotiable chips and free bet vouchers provided free of charge by casino operators to selected gamblers to encourage them to gamble were not to be included in computing the casinos’ “bankers’ profit” from bets “staked” and, thus, were excluded from gaming duties. Although this finding is not relevant for HST purposes given that ETA s. 187(1) has effectively been overridden by s. 7(7) of the Games of Chance (GST/HST) Regulations, the decision included (at paras. 9-12) an extensive description of the different attributes of such chips and vouchers:

Non-negotiable chips are provided to selected gamblers as a promotional tool. They have some of the characteristics of normal cash chips. In particular, they may be used to place bets at the gaming tables and they are replayable until they are lost. If the gambler wins, the banker pays out the winnings in cash chips and the gambler retains the non-negotiable chips and may use them to place further bets.

There are important differences between non-negotiable chips and cash chips, however. First and as I have mentioned, they are not purchased for cash but are provided free of charge. Secondly, they cannot be used to buy goods or services, nor can they be encashed. They can be used to place bets and that is all. Thirdly, when a gambler loses a bet placed with non-negotiable chips, the banker places them in the table’s “drop box” which is a secure box under the gaming table. In contrast (with the exception of tips), cash chips are not placed in the drop box. Rather, when a gambler loses a bet placed with cash chips, the chips are placed in the chip float, a tray which rests in front of the banker and contains the casino’s chips. Fourthly, non-negotiable chips are physically distinguishable from cash chips. The face of each non-negotiable chip is clearly marked “non-negotiable”.

Free bet vouchers are printed paper vouchers which are also provided to selected gamblers as a promotional tool. There are several different types. “Free play vouchers” or “replayable vouchers” can be used in just the same way as non-negotiable chips. If the gambler loses the bet, they are placed in the drop box. If the gambler wins the bet, the winnings are paid to him in cash chips and the voucher is returned to him and may be used to place further bets. “One-hit vouchers” can only be used to place a single bet, regardless of whether the gambler wins or loses. Once the voucher has been played, the dealer puts it in the drop box. If the gambler has won the bet, his winnings are paid in the form of cash chips. If he loses the bet, he receives nothing. “Cash match” vouchers operate in a similar way to one-hit vouchers, except that a gambler must first place a bet with cash chips in order to use a cash match voucher of the same value. Finally, there are “free gaming chips vouchers”. They may be exchanged for non-negotiable chips at the casino’s cash desk without charge. These non-negotiable chips can then be used in just the same way as other non-negotiable chips.

Non-negotiable chips have no printed terms and conditions. Free bet vouchers, on the other hand, are subject to terms and conditions which may limit the games in which they may be played (for example, blackjack or punto banco), the bets for which they may be placed (for example, even money bets) or the time at which they may be used (for example, between particular dates).


Administrative Policy