Commissioners of Customs and Excise v Westmorland Motorway Services Ltd
| Jurisdiction | England & Wales |
| Judgment Date | 21 February 1997 |
| Date | 21 February 1997 |
| Court | Queen's Bench Division |
Chancery Division
Before Mr Justice Lightman
VAT - free meals and cigarettes - tax payable on retail price
A service station which supplied a free meal and either cigarettes or cash in lieu to a coach driver who brought a coachload of at least 20 passengers for a minimum of 30 minutes, was assessable to value-added tax on the retail price of the cigarettes or meals supplied, and not on the cost price.
Mr Justice Lightman so held in the Chancery Division, allowing the appeal of the Commissioners for Customs and Excise from a decision of a VAT Tribunal of July 26, 1996 that VAT should be assessed only on the cost to the service station of providing the meal and the cigarettes, and remitting the matter to the tribunal. The commissioners had made an assessment on June 20, 1994 based on the retail price of the cigarettes and meals.
Mr Kenneth Parker, QC, for the Commissioners; Mr William Massey, QC, for the taxpayer.
MR JUSTICE LIGHTMAN said that the present case explained why coach passengers were required to wait half an hour when the coach they were travelling on stopped at a motorway service station.
The delay arose from an arrangement between the coach driver and the service station that, in return for the driver providing a coachload of at least 20 passengers and waiting that length of time, the service station would provide the driver with a free meal and either a packet of cigarettes or money instead.
The question for the court was whether VAT was payable by the service station on the cost to the service station of providing those benefits to the driver or on the retail price which the driver would have had to pay if he bought the meal and cigarettes.
Westmorland Motorway Services Ltd operated three motorway service stations in Cumbria, where they offered a free packet of cigarettes or cash in lieu, and after March 1, 1992 additionally a free meal to any coach driver, upon identification, who brought a coach with 20 or more passengers and stayed for at least 30 minutes. Such arrangements between coach drivers and motorway service operators were common.
It was common ground that Westmorland was making a taxable supply of goods to the coach drivers in the form of cigarettes and meals. The commissioners conceded that where cash was provided in lieu of cigarettes, VAT was assessable on no greater sum than that provided.
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Commissioners of Customs and Excise v Westmorland Motorway Services Ltd
...taxpayer, Westmorland Motorway Services Ltd, from the decision of Mr Justice Lightman in the Chancery Division (The Times March 4, 1997; [1997] STC 400) allowing the appeal of the Commissioners of Customs and Excise from a decision of a Manchester VAT Tribunal of July 26, 1996, which had al......
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Lex Service Plc v Commissioners of Customs and Excise
...the non-monetary consideration) is prepared to spend. 22 The Court of Appeal considered these authorities in Customs & Excise Commissioners v Westmorland Motorway Services Limited [1998] STC 431. Westmorland ran motorway service stations. Its practice, known to coach drivers, was to provide......
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Ping (Europe) Ltd
...126/88) (1990) 5 BVC 21 C & E Commrs v Bugeja VAT[2000] BVC 21 C & E Commrs v Westmorland Motorway Services LtdVATVAT[1998] BVC 154 (CA); [1997] BVC 198 (QB) Elida Gibbs Ltd v C & E Commrs VAT(Case C-317/94) [1997] BVC 80 Empire Stores Ltd v C & E Commrs VAT(Case C-33/93) [1994] BVC 253 Nat......
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Lex Service plc v. United Kingdom (Commissioners of Customs and Excise), [2003] N.R. Uned. 262
...consideration for Westmorland's taxable supply of cigarettes, food and soft drink. The Court of Appeal, upholding Lightman, J., ([1997] STC 400), who had reversed the Tribunal ([1996] V & DR 185), held that the consideration was to be determined by reference to Westmorland's n......