Is gameshooting an industry or a sport? A good question, and one which has fascinated Her Majesty?s Revenue and Customs to such an extent that it has set up something named the National Shooting Project. What entrances HMRC about shooting is that it is an industry, or sport, which is worth, according to some calculations, more than £2.5billion to the UK economy, but seems to pay very little VAT. Hardly surprising, then, that at a recent Shoot Seminar organised by land agents Smiths Gore to discuss results of the Shoot Benchmarking Survey it runs with Guns on Pegs, there was an expert, John Endacott of West Country accountants Francis Clark, on hand to give an expert view on the perils and pitfalls of VAT and shooting.

The key argument against the levying of VAT on shooting is that private, non-profit sporting clubs are exempt from charging VAT on subscriptions. Shooting syndicates that are non-profit are both private and sporting, so this exemption also applies to them. HMRC has, over the years, taken several cases to the tax tribunals in a, to date, vain attempt to apply VAT to shooting syndicate subscriptions. Perhaps the most famous one was against Lord Fisher in 1981, and the judgements on these cases now form the case law that governs VAT and shooting. That, of course, does not mean that HMRC is going to give up trying to find a chink in the shooting world?s armour. Last year, it took a syndicate to a tax tribunal on the basis that the free days provided to the landowner were the equivalent of let days and therefore VAT ought to have been charged on them. This argument was rejected by the tribunal, which held that the landlord?s days were a consideration given by the syndicate, and not the exploitation of the rights in return for a fee. On such niceties our quiet enjoyment of our sport rests.

The private sporting club

But back to the private sporting club. The definition of such a beast is that (a) it is a not-for-profit organisation; (b) it is closely linked to sport, and (c) those taking part in the sport are the true beneficiaries of the club. Of course, most sporting clubs do not only offer annual membership, they also have temporary memberships for those who happen to be in the vicinity and want, for example, to play a round of golf. It is through this door that some very big shoots have driven their Range Rovers, offering temporary membership of their private sporting club to anyone who comes to shoot, thus avoiding charging VAT on the cost of the day. However, to make sure this works, you need to set up a properly constituted club. This means that the landowner needs to cede control to a committee that will lease the shoot from him. More paper and bureaucracy, but then what else did you expect? For this to be successful, shoots must be non-profit making organisations, which I am sure they are. I suppose even a non-profit making private sporting club is allowed to pay its secretary (or in this case, keepers, beaters and pickers-up) a decent salary?

The main rule regarding VAT and shooting is caveat emptor. HMRC has publicised its belief that any company which is precluded from distributing profit

but whose function is nonetheless to create VAT exemption in the context of a wider commercial undertaking, is not a non-profit making body for VAT purposes. Reading that statement from HMRC, I am forced to conclude that it has not given up on its efforts to find a way to charge VAT on shooting. I suspect that it will be bringing some new cases before the tax tribunals in the near future in order to test the strength of some of the methods used by big shoots to avoid having to charge members VAT.

It is ironic that just as so many people have begun to talk about shooting as an industry in order to underline its importance to the rural economy, it is its status as a sport that enables it to escape from the clutches of the VAT man.