Wildfowl and Wetland Trust wins VAT battle

Posted: 2nd September 2013

Sir Peter Scott’s brainchild, The Wildfowl and Wetland Trust, has won its marathon fight for a £1.3 million tax rebate after convincing the First-Tier Tribunal that seven of the sites it operates across the country are ‘zoos’ so that admission charges paid by the public were exempt from VAT.

Bird flockIn a long-running dispute with Her Majesty’s Revenue and Customs (HMRC), the Trust had reclaimed output tax over a period of almost nine years, arguing that the sites fitted the Shorter Oxford Dictionary definition of zoos in that they were ‘places where wild animals are kept for breeding, study or exhibition to the public’.

HMRC countered that many of the birds on the sites were free to come and go as they pleased and that the exhibition of captive animals to the public was merely ancillary to the Trust’s primary purposes of conservation, research, education and recreation. It was submitted that the sites were as much devoted to the conservation of wetland habitats as to the exhibition of birds that visit them.

The Tribunal accepted that the birds were kept in naturalistic settings which sought as far as possible to replicate their natural habitats. They were not kept in aviaries and their captivity was achieved through a combination of fencing and pinioning, or feather cutting. It was also true that many non-captive birds visited the sites and could be viewed by the public at a distance.

Allowing the Trust’s appeal and ruling that admission charges were exempt from VAT under schedule nine of the VAT Act 1994, the Tribunal noted that there was no dispute that the overwhelming majority of birds held captive on the sites were not native to the UK and were kept for exhibition to the public.

Each of the sites was licensed under the Zoo Licensing Act 1981 and, although they were not described as zoos on marketing material, visitors were given the chance to get ‘nose to beak’ with species that they would not normally encounter. Noting that animal and habitat appreciation often go hand-in-hand, the Tribunal found that only a minority of enthusiasts were drawn by the sites’ nature reserve elements or by the chance to see migratory or non-captive birds. The majority of visitors were attracted by the Trust’s captive collections which could be viewed all the year round.